The Big Picture
The U.S. economy ended 2024 a bit hot, fueled by strong consumer consumption and job growth.
Analysts predict that 2024 GDP growth will come in at around 2.7%, beating expectations.
In December, inflation notched up 2.9% compared to a year earlier, yet core inflation (excluding food and energy) dropped, giving the markets a boost.
December Trends
It was a great holiday season for most of our retailers, with sales up 4% overall last month.
Menswear posted a 6% sales gain, led by sportswear categories, which were up 9% in total.
Women’s wear came in flat, but we did see a nice pickup in special occasion dresses, up 18%, and skirts, up 23%. These gains came despite weaker demand for dresses over the last couple of seasons.
In both men’s and women’s, sweaters and knits were among the top sellers and we expect this trend to continue into spring.
2025 – Focusing on Turn & Newness
With new government trade proposals, we could face some additional pricing uncertainty this year.
If you’re going to focus on one metric to bring stability, we suggest that you take a close look at your turn rates. If you increase your turn, you can decrease your markdowns and this helps you maintain your margins.
With quicker turn rates you’ll also need to buy less upfront, leaving more purchases for in-season when you have a better idea of exactly what you need to sell.
This is also where newness comes in. Better margins will allow you to take a chance on new vendors, keeping customers excited and coming back.
Blacks’ Bottom Line
We’re starting off the year on a strong footing, but you need to be methodical with your planning to maintain the gains we’ve seen in recent years.