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E-commerce creates banner year for retail sales
By Sheila Watson
Contributing Writer
Al Parish’s assessment of the holiday season is nothing short of a rave.
“It was the best year ever for retail sales,” said Parish, who, as director of Charleston Southern University’s Center for Economic Forecasting, tracks the numbers. “It was even better than the holiday season after Hugo.”
The spending that followed Hurricane Hugo, Parish said, was the high-water mark for retailers.
“You had people rebuilding their houses,” he explained. “They had to get new furniture, new fixtures and new appliances to go in it. And some needs were even more basic: People had to get new clothes; pantries had to be restocked. The power was out for a while, so everything refrigerated and frozen had to be bought again.”
The 2005 holiday shopping season in the Lowcountry did not have a natural disaster to kick it off, but the figures are impressive nonetheless.
Data provided by the South Carolina Department of Revenue shows a 14% increase from Dec. 2004 to Dec. 2005 in gross sales for Charleston County. For the entire tri-county area, gross sales increased 8% during December.
For the entire year, gross sales increased 12.8% in Charleston County and 9% in the tri-county area. For both the holiday season and the year, Berkeley County experienced a slight drop.
“Certainly part of the reason for the increase in sales is that we have more places to shop, which happens every year,” Parish said. “Some of it is being driven by tourism. We know we had a record year there.
“Also it’s being driven by the population increases. Everyone knows we’re having substantial numbers in that sector with the housing boom. It was a record year for houses, and you know what that means: You’re going to put in new carpets, new appliances, new everything.”
The e-buying frenzy
Parish also pointed out that online sales have increased more than 30% three years in a row, which is good for the economy but bad for economists.
“The sales tax revenue used to be a quick and dirty indicator of how we were doing,” Parish said. “Now we have this complicating factor of online sales, which makes it difficult to tell how the local economy is doing based on sales tax.”
Although local and state numbers for online sales are not available, national statistics show that it was a banner year for online holiday shopping.
According to a report released jointly by Goldman, Sachs & Co., Nielsen/Net Ratings and Harris Interactive, holiday spending online for 2005 reached $25 billion nationally, excluding travel. The total represents a 25% increase over the same time last year.
Of the $25 billion spent nationally, apparel accounted for the highest amount of spending with $4.7 billion in sales. Computers and consumer electronics each accounted for $3.7 billion in sales.
The numbers for the entire year were also encouraging, with online retail sales at $82.3 billion nationally, a 24% increase over 2004.
The increase in shopping online is due to convenience as well as necessity. Data from comScore Network shows that when the New York City subways shut down during the last transit worker dispute, online sales in that area increased by 28% during the first two days of the strike.
Parish expects the upward trend of online purchasing to continue.
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