Bloomberg reports, “US retail sales unexpectedly rose in August, supported by online purchases that masked more mixed results at other merchants. The value of retail purchases, unadjusted for inflation, increased 0.1% after a revised 1.1% gain in July, Commerce Department data showed Tuesday. Excluding autos and gasoline stations, sales advanced for fourth month.” Good demand is good news for Supply Chain Resilience. A slight decline in retail Inventories (here and here) should also be good news for manufacturers and carriers selling to replenish inventories.
I have particular personal and professional interests in food flows. Below are the retail sales trends for Food Away From Home (blue Line) and Food At Home (red Line). These are nominal dollars. Some obvious observations that are nonetheless worth highlighting:
- Both FAFH and FAH are generating sales well above pre-pandemic trends.
- Spending on FAFH now seems to have displaced FAH as where most US food dollars are spent. Pre-pandemic this was already true in many (especially urban) places. But post-pandemic consumer preferences (and passed along costs-of-inputs) have accelerated a significant structural shift.
- High rates of growth have cooled — since January 2023 for FAH and since January this year for FAFH.
As always, the question is, “Whither goest demand?” Right now it is going fine but flat for food. Behavior in other retail segments do not suggest sustained rapid deterioration is likely anytime soon. But the “mixed results” referenced by the Commerce Department will probably continue as a post-pandemic “new normal” increasingly takes hold.
