January 2023 Industry Update with Doug Cofiell
Ivystone CEO Doug Cofiell shares his insight into how the various factors of the current US economy will affect our gift and home retailers in the coming year.
More than anything else, the question I get asked most is about the economic outlook, what we see going on in the in the overall economy. I'd describe it as confusing.
EXPECTATIONS FOR 2023
We have a downturn in housing that's taking place for quite a while. That usually affects our business pretty directly, but it takes a little while. So normally what we'd see in a time like this is we'll continue to see an upward trend in travel and services experiences, those kinds of things.
We see high inflation, we see higher interest rates, which is causing the housing market to drop quite a bit, but that's offset by a very unusual environment where we have high employment. We continue to see jobs open everywhere and when we have full employment, our industry tends to do really well regardless of the situation elsewhere. Everybody's got a job, everybody's fairly comfortable. They're going to buy for themselves and for others the gifts they need, the home accessories they need. So we expect the year to be pretty stable despite all the news you hear out there about how tough the economy is going to be. As you approach the year, we know it's a little complicated and we know you're not sure how to plan for it. But here at Ivystone, we're looking forward to a to a pretty nice 2023.
SUPPLY CHAIN STATUS
Most of our vendors are really good inventory position. Most of the supply chain issues across Asia have cleared up and goods are flowing pretty steadily. We saw that happening in the fall of 2022, and we expect it to continue for most of 2023. As you lay your plans out for the year, you can expect pretty consistent goods flow throughout the year.
We see some economic headwinds for the year, and there are some things that are not very positive. There's inflation issues and several problems with the rise in interest rates and housing. But - we do have the very positive spin, which is that there's 70 million millennials coming into their prime buying years, and that's going to have an effect on purchases of goods in both the home and outside of the home. So there are positive trends.
Overall, it's a bit confusing and you'll hear a lot in the news this year about how the economy is going to be fairing. We'd expect, though, that overall our business, this industry is going to remain solid in 2023.
Thank you all for your business, we appreciate all you do, and please reach out to anybody at Ivystone with questions. We are always happy to answer questions or help in any way we can.