Consumer sentiment increased 8% in June, hitting the highest level in four months; the rise is attributable to easing inflation and resolution of the debt crisis. While still at historically low levels, consumer sentiment is 28% above the historic low of June 2022.
Retail sales increased 3.9% over 2022; month-to-month sales increased just 0.4%. Looking forward, back-to-school could be impacted just as the shopping season gets started if UPS does not reach an agreement by end of July to avert a potential strike as union contract discussions are currently stifled.
In the current economic environment, retailers must focus on a multi-prong operational improvement approach to drive inventory effectiveness, labor optimization, and operating efficiencies while driving traffic and conversion. It is crucial for companies to focus on capturing value from changing consumer dynamics to ensure success in the evolving and tenuous retail landscape.
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