| Peak season for shopping in North America is shaping up to be pretty solid so far, especially given the Scrooge-like effects that inflation can have on consumer behavior. That's among the takeaways from a conversation with Kraig Foreman, the North American president of DHL Supply Chain's e-commerce business. "If your expectations are that, considering all the inflation and economic concerns, we are going to achieve retail sales at the levels that we saw last year — yes, this year is going to be successful," Foreman said in the interview. He's expecting "small increases in sales on dollars, but on volume — the number of units, the number of physical orders — it's going to be the same as last year,'' he said. Compared with pre-pandemic volumes, "we're way up," by perhaps 15%-20%, he added. This year's slight increase in spending will be partly due to inflation, and the unleashing of some delayed purchases. 'Moving Forward' "People have waited to spend — we saw suppressed spending in the summer waiting for these discounts to come on these higher-end items, whether it be a high-end pair of shoes or whatever that might be," Foreman said. "Now they've got the discounts and they're moving forward with the spending." Foreman's views jibe with those of the US's National Retail Federation, which said Tuesday that a record 196.7 million American consumers flocked to stores and e-commerce websites over the Thanksgiving holiday weekend in search of deals. (Read more of that story here.) Retailers' price reductions through the holidays should help them work through bloated inventories, and Foreman sees 2023 as the year of transition for supply chains to return close to normal. "When you think of a global supply chain, it is a rhythm, it is something where every step needs to happen in order to create balance and equilibrium," he said. "The pandemic hit and we cut parts of those chains off and had to bring them back together again, and it created this pendulum of surges where we had these big hills and valleys." Next year, it's going to be all about "creating that rhythm back into supply chains, back into infrastructure, back into some economic stability and I really think as we come out of 2023, were going to have a larger sense of normalcy." Here's more from the interview: Based on what you've seen so far, how would you characterize the health of the US economy — from consumers to the companies trying to meet the demand? Foreman: It's a very interesting dynamic going on right now. Each peak season that we have seem to take on its own personality. Last year we saw constraints in sales probably due to limited inventory availability but yet there was probably a surplus of disposable income. This year we're seeing the opposite effect where retailers and e-tailers have large amounts of inventory on hand and inventory surpluses to a very large degree yet there are probably constraints on the disposable income. So I think what we're seeing right now as we've gone through Cyber weekend and now into Cyber week, we've seen very similar volumes to last year. It's taken a different shape and probably some categories have become stronger than others, just based on where the disposable income is in our economy. Can you run through some of the retail categories and describe how they're performing? Foreman: Consumer electronics is definitely going to be high this year as a percentage of the sales. But even within apparel and those types of submarkets, people are more than willing to go out and buy the higher-end pair shoes than maybe the small accessory or some of the fast-fashion-type concepts. We're seeing volume in those areas, but we're seeing a higher spend in the higher-end categories. What happen to the theory that the pandemic would be the demise of traditional retail to the long-term benefit of e-commerce? Foreman: There are elements of that theory that have played out to be accurate. What we'll find is that online sales are very much strong and in line with last year, which was elevated from the previous year, which was when we had that huge boom. So we've seen the huge step change in consumer behavior to do online shopping and we have not gone backwards. What you're probably not going to see is the incredible rate of growth of online sales taking over the bricks-and-mortar that we saw from the pandemic. So we're maintaining the level, we're not going backwards, but we're also not keeping the same trajectory that the pandemic created. So it really put a boost into online sales that we thought was going to take six to seven years — it happened in two — and now we're kind of riding that boom out for a little bit with more reasonable growth levels that will take place over the next couple of years. There's still more growth to come, economic factors will play a role in that, but also the demographics of people are also going to play a big role in that. The largest adopters of online sales is Gen Z and they don't have money yet, so what happens when they start getting large disposable incomes as they mature in the economic impact, we're to see that continued adoption just in demographics alone. More Key Reading: —Brendan Murray in London | 
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