Following the trend of recent years, retailers here are again predicting sales growth for 2016. However, not all of those interviewed are confident this period of gains will last.
Grant Forsyth, chief economist for Spokane-based Avista Corp., says retail growth in the region has been strong these last years, in part because of low interest rates.
“Lower interest rates are a big driver of sales, as low rates encourage consumer spending, particularly on those items that require financing like vehicles,” Forsyth says.
He says economic conditions and employment growth this past year have positioned retail markets to have an improved holiday season. However, Forsyth cautions that the strong retail numbers might not be sustainable in the long run.
“Historically, the primary driver for sales is income growth. Unless income picks up as interest rates rise, we can expect to see some easing in the growth of retail sales,” he says.
“Taxable sales for Spokane County grew from 6.2 percent in 2013, to 6.8 percent in 2014. I expect for 2015 that number will be in that same range again, but probably on the lower side as our income just hasn’t been strong enough to maintain that level of sales growth,” he says.
Bryn West, general manager of River Park Square, says the downtown mall’s sales this year were impacted by weather events such as the summer wildfires and the November windstorm.
“There was a difference in sales this year from last, but most of that we attribute to the weather,” says West. She concludes that barring further weather events, the mall should be on track to end the year with sales figures similar to those in 2014.
As a result of a recent AMC Theater remodel there, West says the mall is expecting at least a 50 percent increase in visitor traffic to the theater, which also will help to increase sales at other retailers.
“The national sales trend is up by 2.7 percent, and we believe we’ll be on target with—or better than—that for 2016,” she says.
West says the opening of an Urban Outfitters store there next fall also will increase sales, providing additional offerings for the back-to-school crowd.
“We’re looking forward to offering more to the younger generation, as traditionally we’ve been more focused on fall fashions during that time of the year,” she says.
Moving into 2016, West says the mall will focus on enhancing shoppers’ experiences.
“Shoppers are more educated than before,” she says “If they’re going to spend their time shopping, they want to have a good experience overall, not just a good buying experience. We want to focus on enhancing that.”
Andy Keys, sales manager for Wendle Ford, at 9000 N. Division on Spokane’s North Side, estimates that auto sales there this year were up at least 5 percent.
“It’s not a huge increase, but sales are up, and we expect that to continue into 2016,” he says.
Keys says the most popular vehicles sold are SUVs, luxury pickups, and the new Infiniti line. He says the three main factors that have contributed to pickup sales this year are low gas prices, better fuel economy, and an increase in availability of Ford F150s.
“In 2016, Nissan is coming out with a new mid-size, diesel pickup called the Titan, which features a Cummins engine,” he says. “That model will also be good for business, especially here, where Cummins has such great name recognition.”
Keys concurs with Forsyth on the fact that low interest rates have also played their part in the increase, with Ford having recently offered deals of zero-percent interest for 72 months.
“That deal generated lots of traffic for us, and we sold more highline pickups and SUVs than we typically sell in just one month,” he says.
Keys says overall, shoppers prefer newer cars, with charger ports for devices, as well as safety enhancements like collision warning systems and adaptive cruise control.
For 2015, Spokane County adopted a budget that factored in $22 million in local retail sales tax revenue, which actually increased about 4.5 percent, to an estimate $23.1 million, by the end of the year. In 2016, the county estimates local retail sales tax will increase by 2 percent, to an estimated $23.6 million.
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