Necessity and food-based categories back retail’s positive sales trajectory. Over the course of 2023, core retail sales exceeded the expectations of analysts and is thanks to strong demand in necessities and food-based categories. Investment firm Marcus & Millichap has published a report that gives insights into the strength of the retail market over 2023.
A large finding in the report is that core retail sales have rose 5.2 percent over a year period ending in November. With inflation considered, this is still a 1.2 increase in real spending. Consumer spending habits are favoring the necessities offered in retail. That means categories such as groceries, health and apparel made up 48 percent of sales in physical stores.
Consumer spending habits have also helped bolster restaurants and bars. Annually consumer spending increased 11.3 percent. Through the end of the year this specific segment of retail could continue to benefit as there is to be expected a significant influx of holiday travelers.
Driven by a record Cyber Monday, online spending rose 10.6 percent year-over-year in November. Of the purchases made, nearly 10 percent utilized buy now-pay later agreements.
