NRF Market Outlook and Europe

By

Following on from the NRF Big Show which we previously wrote about, the National Retail Federation (NRF) launched their annual economic outlook, with a helpful one-page summary here. But there are differences between the US and European consumer markets. We’ve compiled a summary of the main points below. 

 

Note: The key economic differences between American and European retail markets in 2024 listed below draw on trends but do not rely on specific data from the National Retail Federation (NRF). These differences are observations rather than statistics.

Store Size and Shopping Habits:

  • US: Dominated by large, out-of-town superstores offering one-stop shopping experiences. Consumers tend to buy in bulk and value convenience.
  • Europe: More focus on smaller, local shops and open-air markets. Consumers often shop more frequently for fresher ingredients and daily necessities closer to home.

eCommerce:

  • US: eCommerce is booming, with giants like Amazon leading the way.
  • Europe: eCommerce is growing steadily, but brick-and-mortar stores still hold significant weight, especially in some countries such as Italy.

Regulation:

  • US: Generally less regulation on retail businesses compared to Europe.
  • Europe: More stringent regulations regarding consumer protection, data privacy (such as GDPR), and worker rights. This can impact online transactions and store operations.

Consumer Spending:

  • US: American consumers tend to spend a higher proportion of their disposable income on retail goods, potentially due to a culture of consumption and readily available credit.
  • Europe: European consumer spending can be more varied depending on the country. Generally, there might be a stronger emphasis on saving and experiences compared to the US. The economic downturn is seen as more dangerous to an individual household in Europe compared to that of the US. 

Brand Loyalty:

  • US: American consumers might be more susceptible to national advertising campaigns and brand promotions.
  • Europe: European consumers can be more loyal to local or regional brands, with a higher value placed on quality and heritage. 

Taxation:

  • US: Sales tax varies by state, with some states not having one.
  • Europe: Most European countries have a Value Added Tax (VAT) applied to most retail goods, which can affect overall product pricing. It varies from country to country and members of the EU have different rules and tariffs to non-member States such as Britain. 

Sustainability:

  • US: Sustainability concerns are growing in the US retail market, but progress can be uneven across different sectors.
  • Europe: There’s often a stronger emphasis on sustainability in European retail, with regulations and consumer demand pushing for eco-friendly practices and products.

These are some of the key economic differences. It’s important to remember that Europe is a continent with many countries, and retail markets can vary significantly within the region. By asking the right questions, utilizing resources, and adjusting to new market dynamics, you can transform your online business expansion in Europe from a challenge to a competitive advantage.

Focus on the Success

We believe every ambitious retail organisation needs a partner who can manage all the sales tax compliance matters. Ambition requires time and focus – which should not be spent on complicated, time consuming and plain well distracting tax matters. While you obsess about your customer, let us focus on the “other” things!

Taxmatic automates VAT calculations, filings, and payments for eCommerce retailers selling in EU and UK markets. It integrates seamlessly with eCommerce selling platforms to access sales order data in real time. The process includes secure payments wallet technology to complete sales tax remittance and manage refunds. Our customers have the peace of mind that comes from full regulatory compliance. Plus, the benefits of eliminating manual processes. Gaining more time to expand their online business in new international markets.

Ambition requires time and focus....

Time should not be spent on complicated, time consuming and plain well distracting tax matters. While you obsess about your customer, let us focus on the “other” things!