NRF Releases 2025 Retail Sales Forecast—And It’s Not So Bad
The markets might be fighting for their lives right now, but that’s not to say all is lost. The National Retail Federation(NRF) has released its 2025 retail sales forecast, projecting growth between 2.7 percent and 3.7 percent over last year—totaling $5.42 trillion to $5.48 trillion in sales. While not an explosively high number, this steady increase does signal cautious optimism in the market. As a small business owner, understanding these trends can help you make smarter decisions about inventory, marketing, staffing, and budgeting for the rest of the year. Let’s dig in!
Retail Growth Remains Strong, But Slower
Compared to 2024’s 3.6 percent growth rate, 2025 will see slightly slower but stable expansion. NRF’s forecast aligns with pre-pandemic growth trends, indicating a return to a more predictable, sustainable pace. According to NRFPresident and CEO Matthew Shay, “Overall, the economy has shown continued momentum so far in 2025 — bolstered by low unemployment and real wage gains — however, significant policy uncertainty is weighing on consumer and business confidence.”
Ecomm Keeps Climbing
Non-store and online sales are expected to grow between 7 percent and 9 percent in 2025, reaching $1.57 trillion to $1.6 trillion. This continues the trend from 2024, when online sales grew 8.1 percent. If your business doesn’t already have a strong digital sales presence, this is the year to invest in improving your e-commerce platform, optimizing for mobile, and refining your digital marketing strategy.
Slower GDP Growth—But Consumers Still Spending
The NRF expects GDP growth to slow to just below 2 percent this year, a drop from 2.8 percent in 2024. But despite this, key indicators like low unemployment, real wage gains, and solid household finances are keeping consumer spending afloat. As NRF Chief Economist Jack Kleinhenz notes, “While we do expect slower growth, consumer fundamentals remain intact. Consumer spending is not unraveling.”
Inflation, Tariffs, and Consumer Confidence
Although headline inflation has moderated, Personal Consumption Expenditures (PCE) inflation is expected to remain around 2.5 percent in 2025. Rising tariffs and lingering inflation have impacted consumer confidence, but not yet consumer behavior.
What This Means for Your Small Business
This data can be a fantastic measure if you’re looking to better inform your business strategy. Check out 5 key areas you can set your sights on now:
- 1. Focus on Value and Service
Consumers are still spending, they’re just doing it more carefully. Offering value-added services, clear pricing, and exceptional service can help you win loyalty. - Strengthen Your Online Presence
With online sales expected to rise 7–9 percent, make sure your e-commerce site is user-friendly, mobile-optimized, and tied to your social media and email marketing. - Keep an Eye on Costs
Tariff-related inflation and rising input costs may affect margins. Review supply chains and explore local sourcing or bulk purchasing strategies to save. - Invest in Retention Over Recruitment
A stable job market means talent retention will be key. Incentives, flexible scheduling, and workplace culture can keep your best employees on board. - Monitor Consumer Trends
Stay updated with real-time data and feedback. Tools like Google Trends, point-of-sale reports, and customer surveys can help you respond quickly to shifts in demand.
Retail sales are still growing in 2025, it’s just happening at a more modest pace. This means consumer spending isn’t vanishing — it’s just evolving. If you adapt to economic realities while doubling down on your customer relationships and digital strategy, your small business can continue to thrive. Check out the NRF’s 2025 State of Retail & the Consumer Report for more information, and keep up with the Financial Pantry over at ARF Financial for the latest news in small business.
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