Kingsport, Bristol and Sullivan County were “the only clear winners” in last year’s Christmas holiday selling sweepstakes, according to a 4th quarter retail sales report released Tuesday.
The report compiled by East Tennessee State University’s Bureau of Business and Economic Research noted Kingsport recovered from a summer sales slump, while Bristol reported the seventh consecutive quarter of higher retail sales.
Johnson City, meanwhile, saw a second quarterly decline in retail sales, according to the report.
Over the October-to-December period, dollar sales increased 7.6% to about $298.2 million in Bristol and 3% to $407.5 million in Kingsport.
Although Johnson City sales fell 0.7%, it still recorded the highest fourth quarter sales at $529.1 million.
For the Tri-Cities Combined Statistical Area, dollar sales were flat and rose only 0.1% to $1.7 billion for the quarter.
“Retail sales in the fourth quarter are more significant than the other periods of the year due to the holiday selling season,” the report pointed out. “For many retail stores, the holiday sales account for 40% of total annual activity and determine the profit or loss for the entire year. From this perspective, the holiday selling season was a disappointment in the region and modestly successful in the state and the nation. Adjusted for inflation, retail sales were down in the Tri-Cities metro area, one of the three cities, and five of the seven metro counties. Retail growth in the state and the nation was positive, but well below the increases enjoyed in 2010 and 2011. ... Retail performance does not exist in a vacuum and must be related to other elements in business conditions. The Tri-Cities metro area has largely recovered recession losses in production and employment, but regional consumers are not yet ready to spend at pre-recession levels. This is a problem and an opportunity for local merchants.”
Nationally, the report stressed employment is growing at its best rate in five years and retail sales are back to 2007 levels. But 16.7 million workers are still jobless due to the continuing weakness of the U.S. economy.
“Until these millions are put back to work, further retail growth becomes difficult,” the report states. “The business outlook remains unchanged — slow growth in output, employment, and retail activity. The most optimistic forecasts anticipate several years before full prosperity is restored. The large unknown continues to be the political antics in Washington and the impact this can have on business and consumer confidence and spending. ... Now we are enduring the (federal) ‘sequester’ and the required reductions in federal spending which will undercut the overall rate of economic growth. And in late March we are facing another ‘debt ceiling crises’ that could shut down the federal government and derail all economic growth, triggering a new recession. Washington will probably muddle through. The economic train is not going to be derailed but we are also not going to get up that prosperity hill anytime soon.”
For the year 2012, Bristol retailing rose 7.3% to $1.08 billion. Sales were also higher in Kingsport by 2.4% to $1.49 billion, and in Johnson City by 1.2% to $1.91 billion.
Tri-Cities, Knoxville and Chattanooga all reported higher dollar sales for the year, but the growth rate was well below the 2011 retail increases, according to the report.