Last Christmas Eve, when sisters Hana Cux and Jessie Gingrich signed an agreement to renew the store in a large area in Denver’s boker neighborhood, they were happy but not convinced not to surprise the referee who has no payment.
Almost a year later, as they gathered to celebrate the grand opening of the mountain casual clothing, clothing and gift shop, they are excited about the new business but can be sure that the holiday season will add higher prices due to higher prices. They’ve been dealing all year with a revolutionary space at their first store in Colorado Springs.
“We got a little scared when the store wasn’t open yet and all the money started coming down,” Gingrich said. “It certainly made us think a little bit, as it made the right decision?”
Analysts expect an unexpected environment that struggling businesses will drive away consumers and lead them to spending this year. A survey by Deloitte of Denver-Area Shoppers indicated that the average price spent this holiday season will drop by about 14% from $1,782 per home to $1,526.
The national average is expected to be $1,595, a 10% decrease from $1,778 last year.
A survey of 424 people in Metro Denver found that 81% of respondents expect to pay more this year for gifts and 67% believe the economy will decline in the next year, compared to 34% in 2024.
While the survey did not provide the reasons behind people’s strategies to not open their wallets so far, Deloitte noted that this season is behind the economic uncertainty. “
“A lot of people are expecting higher prices. And on top of that, when they look at other things, they were expecting the economy to weaken,” said Robert, Deloitte’s principal in the retail industry.
About 49% of Denver-Area respondents said they would shop at low-cost stores over popular items. Wedding gifts, such as dining out, events or SPA visits, are on the shopping lists of 53% of those surveyed.
The survey found that 40% will look online first and 35% expect to spend most of their money at big box stores. About 19% said they would buy from specialty retailers.
“If I were a local marketer or local retailer, I would really look to put my best foot forward this holiday,” Reid said. “I can make sure I remind people that we are here.”
And being called to believe shows local businesses should make shopping as easy as possible. Another way, he said, is to have a strong online presence so people feel the store has one.
Despite the uncertainty, the National Retail Federation is bullish on the holiday shopping season, saying the economy continues to show “surprising resilience.” The trade association predicts that retail sales in November and December will increase as much as 4.2% over 2024, with total spending exceeding for the first time.
“Since the tariffs caused an UPTICK in consumer prices, sellers tried to hold the line on prices given the uncertainty about trade policies,” the Federation director said in a statement.
However, retailers are hiring fewer seasonal workers, in line with a slower labor market, Matthews said. The Federation believes that the fallout from the government shutdown and the loss of money in the private sector could affect consumer demand.
Holidays: ‘It’s our big dish’
“Christmas is our biggest time of the year. October, November, December, December were huge for us,” said Luke Johnson, founder of the Luke & Co WIT Broadway store.
This holiday season, Johnson predicts a similar boost in business — a 10% to 20% increase in sales. The increase, however, would come after entering the first quarter and second half as the tax rates were announced, planned and reserved.
“It feels like a large part of the volatility is baked into the price of the product now. We expect to see some price moves going forward,” Johnson said.
One thing he doesn’t expect is to see costs go down, even if tax rates are reduced or adjusted. Most pet foods are produced in the US but some of the ingredients, such as rabbit, beef and lamb, come from other countries. Many toys are imported from China. Most of the canned cat food and cat food comes from Thailand. Homemade grocery bags are mostly made in Asia.
Even the printed paper bags that Luke & Co customers carry their things home with are made in China. Johnson said he couldn’t find any US-made replacements at anywhere near the same price. Finding US companies with the same type of equipment and technology as overseas vendors has been a common problem for business owners trying to find higher-priced alternatives.
Johnson, in business since 2016, raised prices as his suppliers raised theirs.
“We were trying to eat as much as possible in the first few months. Our net profit is about 8% a year, so we can’t afford the markup,” Johnson said. “If the price goes up, we only raise the same amount as the increase.”
Small businesses in Colorado and across the country enter the holiday season with extraordinary spending sprees, Hunter Nelson said. He is the director of the Colorado office of the Small Business Association, a national organization.
“We’ve heard from Colorado and our other states that seasonal employment is affected. Prices and other sources of inflation have raised confidence,” Nelson said.
Because of this, he added, small businesses, especially retailers, are hiring seasonal workers. In addition, the uncertainty of how people can relax this holiday season has business owners unsure of how much to spread.
“So some are just biting the bullet and spending their money, and some are just buying a few things right now,” Nelson said.
A national survey of small business majority found that 60% of respondents paid higher cost of imported goods due to taxes. More than half of the 228 businesses said their costs had risen by 10%-25% and almost a quarter reported an increase in spoilage by 26%-50%.
“Like everybody else, the tax rates have definitely affected us,” said Gingrich of the Mountaineer general outfit.
COX described the business as a curated mix of vintage men’s and women’s clothing and gift items.
“We’re really trying to move away from fast food, to find pieces that will last longer,” Cox said. “They are produced ethically and are better for the planet and better for the people who produce them.”
Gingrich said he and Cox also try to work with small and local products as much as possible. Small companies must have materials from US export countries
“The cost is passed on to us, which is passed on to the consumer,” Gingrich said.
Sisters dialing the men’s care drawing from Canada this year because the fee is 25%. They decided to force a shirt that sells well because the price exceeds $20.
“Certain products that were already on the higher end of what we felt comfortable pushing him to a different level that we’re saying is wrong with him,” Gingrich said.
The company’s suppliers have accepted some hits from higher import duties, he added. Gingrich said he was encouraged that sales numbers had recently improved.
“This month so far has been really strong compared to last year, so that’s a little encouraging,” Gingrich said. “But we don’t want to get ahead of ourselves. Things change a lot and we don’t know what will happen.”
And what happens during the holidays is important. “It’s our super bowl,” Cox said.
The sisters are trying to educate people about the benefits of following local stores. About 68 cents of every dollar spent on small, local business resides in Lwakhe, according to the Financial Services Bureau.
“It’s really important to support local businesses because that money stays in your community and supports families in your community,” Cox said.
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