The Internet will be the fastest growing retail channel this holiday season, according to a new Holiday Forecast 2000 report by PricewaterhouseCoopers.
Online sales will cross $10 billion this fourth quarter, aided by first-time Internet shoppers and the large number of traditional retailers debuting their e-commerce business.
“Sales will hinge on how well e-retailers prepare themselves for the onslaught following last year’s failure by many sites to deliver in time for Christmas,” Dr. Carl Steidtmann, director and chief retail economist at PwC, told reporters last week.
Despite the anticipating strong postings, online retail will comprise only 1.2 percent of total retail sales in the fourth quarter.
But while online sales are projected to grow at a fast pace, traditional retail this holiday season versus last year’s fourth quarter may witness a slowdown, the PwC forecast said. The retail sector is expected to grow only 4.5 percent this fourth quarter, down from 8.4 percent in 1999.
“This slower pace of retail activity is due in large part to the growing impact of interest rate hikes by the Federal Reserve, a slowdown in home-building and refinancing, and higher fuel factors, among others,” Steidtmann said.