(Bloomberg) -- Costco Wholesale Corp. is expecting more deals and higher spending this holiday season.
Shoppers are making purchases earlier and they’re increasingly buying non-food items amid cooling inflation, Costco’s Chief Financial Officer Gary Millerchip said in an interview, adding that this bodes well for the crucial year-end shopping season.
So far, Halloween sales have been strong, he said. In particular, consumer electronics are expected to be cheaper during the holidays, and sales are expected to improve as people upgrade their computers and televisions.
“When we have really great, new products at great value, consumers are definitely showing up to buy them. And they are buying them earlier,” Millerchip said. Costco is offering some holiday goods earlier after the company secured them in advance to avoid any snarls in the supply chain.
Costco’s bullish view is a positive sign for the industry, which has been constrained this year by a cautious consumer as purchases skew toward essentials and groceries. The holidays are the most important season for retailers as promotions and gift-buying bolster crowds and sales receipts. The holiday calendar is shorter this year, due to a late Thanksgiving, further upping the pressure.
To entice shoppers, companies are focusing on offering deals and new merchandise. Amazon.com Inc., Walmart Inc., Target Corp. and others are holding discount events in October, while Walmart will also begin selling Thanksgiving food deals weeks earlier. Initial projections on holiday spending point to a slight increase in store sales and a larger jump in online spending.
Costco, which reported higher-than-expected sales and profits Thursday, said toys, seasonal items and home furnishings have been popular in recent months.
Costco shares slipped 1.8% at 11:55 a.m. in New York trading on Friday, paring the stock’s year-to-date gain to about 34%. The shares have outpaced the advance of the S&P 500 index.
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