Retail Sales Continue to Surge
Retail sales are growing at unprecedented rates, according to. The National Retail Federation (NRF). Earlier this month, NRF upwardly revised its retail sales forecast to grow between 10.5% and 13.5% in 2021, reportedly the highest growth rate it has ever forecast.
- May retail sales were 17.3% higher than one year ago. (Source: Census Bureau, NRF)
- Retail sales through the first five months of the year are 17.6% higher than for the first five months of 2020. Compared with the same period in 2019, retail sales are up by 20.8%. (Source: Census Bureau, NRF)
- Growth in 2021 is not just about ecommerce. Removing non-store sales, which include ecommerce, results in 2021 year-to-date sales growth that is still almost 17% above 2020 levels. (Source: Census Bureau, NRF)
New business applications accelerated dramatically since the start of the pandemic and have remained at elevated levels – particularly in the retail sector.
- According to the Census Bureau, retail business applications stood at over 92,000 in May 2021, significantly higher than the 2019 average of 43,000 applications per month. (Source: Census Bureau – Business Formation Statistics)
- During the pandemic, monthly retail business applications saw dramatic growth, peaking at 120K in July 2020. (Source: Census Bureau – Business Formation Statistics)
- Non-store retail accounted for 33% of the surge in new business applications. (Source) Aided by marketplaces such as Amazon, Etsy, eBay and Walmart as well as ecommerce enablers such as Shopify, Wix and Stripe, it has never been easier to set up an online retail shop.
- According to a working paper published by the National Bureau of Economic Research, “areas including a higher proportion of Black residents, and more specifically higher median income Black neighborhoods, are associated with higher growth in startup formation rates between 2019 and 2020.”
Not only are small online business growing but the number of U.S. stores reached the highest level on record in Q4 2020. (Source: Bureau of Labor Statistics QCEW survey)
- As of Q4 2020, there were 1,049,151 retail establishments in the U.S., up 4,671 vs. Q3 2020. (Source: Bureau of Labor Statistics QCEW survey)
- The establishment count was up on a year-over-year basis (vs Q4 2019) by 2,395. (Source: Bureau of Labor Statistics QCEW survey)
- This is the highest quarterly establishment count in the last decade. (Source: Bureau of Labor Statistics QCEW survey)
- According to the Daily on Retail, “So far this year, US retailers have announced plans to open 4,900+ stores and close 2,290+ stores, which covers all sectors except auto retail.”