INFLATION’S IMPACT ON RETAIL SALES GROWTH – August 2025

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Inflation seems simple – just compare this year’s prices to the same time last year. In fact, it is more complex. The most important thing to remember is that it is cumulative so even when the YOY rate slows, it can cause a range of issues – selling less product and even a drop in $. One impact that is often ignored is slowed $ growth. That is the focus of this report. To give a better view of the situation we will include charts covering Jan>Aug 25 for the Big Groups and the “Advance” Relevant Retail Channels. We will include separate charts for Monthly & Ytd data to better show trends.

First the Jan>Aug Monthly Report for Big Groups (100% of U.S. Retail $)

We also included the Y/E numbers for 2024, both actual & average, to show our 1st goal – Beat these lifts!

For the Big Groups, Jan is arguably the best month, but Feb is definitely the worst. It is often the low point of the Retail year. In 25, the lift vs 24 was -78% below avg for Relevant Retail, but Total and all other groups had drops. After a mostly positive July, progress slowed in August. Gas Stations had their smallest monthly drop in 25, but only Restaurants had an above avg lift. April is still the 2nd best month of the year, with 1 drop but 4 above avg lifts, including Total. May was much worse. There was improvement in June/July, then the situation worsened in August.

Restaurants – Restaurants are the best performing group. They had a small, -0.8% drop in February but above avg lifts in all other months. Amazingly, their performance peaked at +36.1% in May,  which is the 2nd worst retail month in 2025.

Auto – Except for May & Aug, their pattern was the same as Restaurants but usually with bigger changes, especially in Mar/Apr. The Mar/Apr lifts were about double the avg. The 25% tariff was effective 4/3/25. Consumers saved thousands of dollars, but the binge buy ended in May, -59.7% below avg. Sales bounced back in Jun/Jul, then slowed in August.

Gas Stations – They are definitely in turmoil. Sales fell Feb>Aug and until Jul>Aug, all drops were bigger than 2024.

Relevant Retail – They do about 60% of Total Retail $. They have a similar pattern but with 2 differences. The biggest is that they were +1% in Feb – no drop. #2 was in July. Their lift was 1.7% above avg while Total was -7.8% below avg. The Feb/Mar, May/Jun & Aug lifts were below avg while the Jan, Apr & Jul lifts were above avg. Their 23>24 lift was above Total. In May & July their lifts were much better than Total. Both had Aug lifts 20+% below avg. Their progress slowed.

Total Retail – They had a small drop in February, but March was basically equal to the avg. Jan & Apr were the only above avg months. All non-Feb months had lifts above the 3.0% 23>24 Y/E increase but the May lift was only +3.1%, -33.9% below avg. The situation improved in Jun>Jul, then worsened in Aug, -25.6% below avg.        Here is a Jan>Aug Summary:    

8 MONTHS: $↓: 10; ↑Avg: 17; ↓Avg: 13

Jan: $↓: 0; ↑Avg: 4; ↓Avg: 1; Feb: $↓: 4; ↑Avg: 0; ↓Avg: 1; Mar: $↓: 1; ↑Avg: 2; ↓Avg: 2; Apr: $↓: 1; ↑Avg: 4; ↓Avg: 0

May: $↓: 1; ↑Avg: 1; ↓Avg: 3; Jun: $↓: 1; ↑Avg: 2; ↓Avg: 2;  Jul: $↓: 1; ↑Avg: 2; ↓Avg: 2; Aug: $↓: 1; ↑Avg: 1; ↓Avg: 3 

Now let’s take a closer look at Relevant Retail. We will report on the 11 channels in our Advance report.

11 Relevant Retail Channels (98% of Ytd Rel Rtl $)

Relevant Retail – Their +3.6% lift in 24 was -22.8% below average. No drops in 25. The lifts for February, March, May, June & August were below average, but Jan, April & July were above average. The August lift is +3.7%, -21.1% below avg.

Furniture – No drops. Lifts were double the average in January, March & April but still big in May>Jul. Aug was below avg for the 1st time since Feb. The huge lifts in Mar>Jul were probably due to fear of high prices from impending tariffs.

Electronics/Appliances – They have ongoing high deflation. $ Dropped in both Jan & Feb. Sales turned positive in Mar, dropped Apr>May, hit +0.0% in Jun, then rose to +1.8% in Jul and +2.6% in Aug, the only above avg lift in 2025.

Bldg Matl/Garden/Farm – They had the smallest of the 4 drops in 23>24, -0.6%, but the 3rd biggest decrease (of 6) in Feb, -6.1%. They had lifts in Jan, Mar, Apr & Jun but all were below avg and mixed with drops in Feb & May. The Jan, Apr & Jun lifts were 70+% below avg. Jul (-1.4%) & Aug (-5.7%) brought 2 more drops but Feb was still the biggest of the year.

Grocery – Sales were only +2.0% in 24, -36% below average but they surged in Jan, 63% above avg. Growth slowed to 1% or less in Feb>Mar, 70+% below avg. They had a strong rebound in Apr. Sales were +5.8%, 93% above avg. The lifts slowed markedly in May>Jun, but increased in July to +3.3%, 8.1% above avg. Aug then slowed to +3.0%, 4.6% below avg.

Health/Drug – Sales were +3.6% in 24, -31% below avg. The lifts grew to 4+% in Jan/Feb, surged in Mar>Jun to +7>11%, 40>124% above avg. They slowed to +5.5% in July, 3% above avg, and then to +3.3% in Aug, below avg and the 23>24 lift.

Clothing – 24 $: +2.5%, -19% below avg. A strong start to 25, but Sales fell -2.4% in Feb. However, the Mar lift was 1% above avg, then Sales “took off” in Apr to +6.9%, more than double the avg lift. The strong lift continued in May, +5.3%, 60% above avg. The binge buying ended in Jun as the lift slowed to +2.9%, but resumed in Jul>Aug, 150+% above avg.

Sport/Hobby/Book – They were -2.8% in 24. This trend continued and hit bottom at -6.4% in Feb. In Mar>May they turned slightly positive. June fell -1.2%, but the Jul>Aug lifts soared to 4+%. Both were above avg, Jul: +28%; Aug: +50%.

Department Strs – It’s hard to find something positive. They were -4.6% in 24 and had drops Jan>Aug in 25. The biggest drop was -5.9% in Feb and the smallest was -0.5% in Jan & July. Sort of good news: 6 of 8 drops in 25 were less than avg.

Clubs/SupCtrs/Value/$ – They offer value & convenience – 1 stop shopping. They have had strong growth from the start. COVID accelerated growth so it is no surprise that all lifts are below avg. They even had small <-0.3% drops in Feb/Mar. April improved to +5.3% but sales slowed to +3.5% in May and +1.3% in Jun. July rose to +2.4%, but Aug slowed to +1.9%.

Miscellaneous – Pet Stores account for 15+% of this group’s sales. They had 2 below avg lifts, Feb & Apr. The Jan & Mar lifts were 80+% above avg and the May>Jul lifts were more than double the avg. Aug was only 63% above avg. They have the 2nd best channel performance, behind Furniture, and they did it without the benefit of a pre-tarifflation buying surge.

Nonstore – 90% of $ are from internet/mail order (vast majority is internet). The Internet has had strong sales growth since its inception, but it skyrocketed due to COVID’s “stay at home” behavior. They have an avg lift of about 10%. Their 24 lift was +8.1%. From Jan>Jul, all lifts in 25 were below this and below average – no surprise. That partially changed with the +8.2% lift in Aug but it was still -20.5% below avg.            Low: Feb +5.0%; High: Aug +8.2%

JAN>AUG SUMMARY

23>24: $↓: 4; ↓Avg: 6; ↑Avg: 1

8 MONTHS: $↓: 22; ↓Avg: 37; ↑Avg: 29

Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 6; ↓Avg: 5; ↑Avg: 0; Mar: $↓: 2; ↓Avg: 5; ↑Avg: 4; Apr: $↓: 2; ↓Avg: 5; ↑Avg: 4

                           May: $↓: 3; ↓Avg: 4; ↑Avg: 4; Jun: $↓: 2; ↓Avg: 6; ↑Avg: 3; Jul: $↓: 2; ↓Avg: 3; ↑Avg: 6; Aug: $↓: 2; ↓Avg: 5; ↑Avg: 4                                                                                                                                                                                                                                                                                                             In the above Summary, regarding Drops and Above Average lifts, green indicates the best and red is the worst. Arguably the best month is July and the worst is February. However, the biggest positive change occurred in March. 4 channels with drops turned positive. 3 became below average and 1 above average. 3 with below average lifts moved up to above average. The classification of 4 were unchanged so 7 fueled the improvement. April was the same as Mar. May was worse than April due to 3 drops. In Jun, Drops fell to 2 but above avg fell to 3. Note: 4+ has become the norm in above avg lifts. We can’t forget January. The number of positive lifts vs Y/E 24 moved up from 7 to 8 but the number with above avg lifts rose from 1 to 4 – a big change. With only 5 drops/below avg lifts, the situation in July greatly improved from 11 in Feb before slowing in Aug. The overall CPI is low but rose in Aug and the 7 drops/below avg again exceed above avg, 4.

Now let’s take a different view of the data from the same retailers. Rather than monthly sales, we  will look at Ytd sales.

The Ytd numbers are arguably the most important. In December, they become Year-End, which is the most quoted and remembered data in any year. While the monthly data shows what’s happening in the marketplace right now, the Ytd data consolidates the data. This blending extends the impact of big sales spikes – positive or negative. This can be either good or bad. The impact of the big drop in February 25 was lessened by the widespread Above Average January lift. It can also work the other way. The big February drop reduced the positivity of stronger lifts in Mar>Jul. Overall, progress stalled in May/June, restarted in July, then slowed in August. We’ll begin our analysis with the Big Retail Groups.

You notice that the spending patterns for Relevant & Total Retl are almost identical. Jan was good for all – 5 lifts, 4 above avg. Feb was bad. Gas Station $ dropped and the others had their most Below Avg lift. In Mar>Aug, only Auto had Above Avg lifts and only Gas Stations had any drops. Restaurants steadily improved but the others’ progress paused in May>Aug

Restaurants – Sales for 24 were +5.2%, -7% below average. They flipped to above avg in Jan, then the lift radically slowed in Feb to +2.4%, -57% below avg. The situation greatly improved in Mar>May, then the progress slowed in Jun>Aug. Their YOY lift essentially stabilized at about +5%, -4>10% below avg for May>Jul. Aug was only -1.8% below avg.

Auto – Sales were +2.3% in 24, -47% below avg and the worst “positive” performance of any group. They turned it around in Jan with an above avg lift. The lift dropped to +2.0% in Feb, -56% below avg and the smallest lift of any positive big group. Their pre-tarifflation buying lift started in Mar/Apr, peaking at +5.9% in April, 33% above avg. In May>Aug the surge slowed, and the lift fell below 5% in Aug. They are the only Group with Mar>Aug above avg lifts.

Gas Stations – Whether you look at the data monthly or Ytd, they are doing bad. The Apr>Aug Ytd sales drops of over         -3.2% are significantly worse than the -2.9% at Y/E 24. That does not bode well for 2025.

Relevant Retail – Except for Jan, +5.0% and now Jul>Aug, 4+%, their YOY lift was stuck in the 3% range. Thanks to an Above avg monthly  lift, April Ytd, +3.9%, did finally exceed the +3.6% of 2024 and stayed at about +3.9% in May>Jun. A strong, July lift restarted their Ytd progress to +4.1%. The lift slowed in Aug, but Ytd is still +4.0%, only 14.4% below avg.

Total Retail – The pattern matches Relevant Retail but the YOY changes for all, but Jan & Mar are smaller. With similar avgs, Total has bigger disparities. Total includes Auto & Gas Stations which have had extreme lifts & drops. Their Mar>Apr progress also paused in May>Jun, rose in July, and slowed in Aug, but their Ytd lift has been above 24 since Mar & stable at +3.6%>3.8% since Apr.

Summary and Comparison of Jan>Aug Monthly to Ytd

Monthly: Drops: 10; Below Avg Lifts: 13; Above Avg Lifts: 17

                                                                              Ytd: Drops;   7; Below Avg Lifts: 23; Above Avg Lifts: 10

                  Mon: Jan: $↓: 0; ↓Avg: 1; ↑Avg: 4; Feb: $↓: 4; ↓Avg: 1; ↑Avg: 0; Mar: $↓: 1; ↓Avg: 2; ↑Avg: 2; Apr: $↓: 1; ↓Avg: 0;↑Avg: 4

                   Ytd:  Jan: $↓: 0; ↓Avg: 1; ↑Avg: 4; Feb: $↓: 1; ↓Avg: 4; ↑Avg: 0; Mar: $↓: 1; ↓Avg: 3; ↑Avg: 1; Apr: $↓: 1; ↓Avg: 3;↑Avg: 1

                  Mon: May: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jun: $↓: 1; ↓Avg: 2; ↑Avg: 2; Jul: $↓: 1; ↓Avg: 1; ↑Avg: 3; Aug: $↓: 1; ↓Avg: 3; ↑Avg: 1

                   Ytd:  May: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jun: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jul: $↓: 1; ↓Avg: 3; ↑Avg: 1; Aug: $↓: 1; ↓Avg: 3; ↑Avg: 1

The orange numbers show that the Ytd report levels the Feb>Aug Big Group data. The Ytd situation isn’t good but it’s better than 24 for all but Gas Stations. Monthly, the Big Groups were never stable. In Ytd data, Mar>Aug was stable.

Now, Let’s look at Ytd Sales for Key Relevant Retail Channels

The Ytd chart looks a little more consistent than the Monthly chart. This is true. Ytd extends the impact of big lifts or drops. The Ytd version has 22% less Below Avg lifts (middle ground), but 32% more Drops & 3% more Above Avg lifts. The result is balance. Ytd also has 2 channels that had drops every month in 2025. Monthly has only 1. However, Ytd has 2 channels with Above Average lifts every month. Monthly has none. It’s a complex situation. Let’s get into the specifics.

Furniture Stores – They are going strong. Their huge January lift pushed the February Ytd lift from below to above avg. Now, all months are above average. Tarifflation fear caused binge buying in Mar>Aug so the current lift is still huge.

Electronics/Appliance – Ytd they are all negative. This version hides the small Mar & Jul lifts, flat $ in Jun & above avg lift in Aug. The positive impact in the Ytd chart was that their YOY drop slowed from -5.0% in February to -0.6% in Aug.

Bldg Matl/Garden/Farm – Their big February drop turned March from a below average monthly lift to a -0.4% Ytd drop. In a reversal, Mar/Apr lifts made Ytd April slightly positive, +0.1%. Sales fell in May/Jul/Aug so Ytd May>Aug was negative.

Grocery – Their big Jan lift made  their Ytd situation look much better. However, Ytd essentially hid the huge above average lift in April and the smaller one in July. Note: Ytd they have been above 24 Y/E in every 2025 month.

Health – Monthly & Ytd had a similar pattern until a below avg lift in Aug – Jan/Feb, below avg; Mar>Jul, above avg. The June lift was huge, more than double the avg. The Aug lift was small, but Ytd is still 30% above avg and 83% above 24.

Clothing – Their big Jan lift eliminated the Feb drop in Ytd, but the Feb drop changed Mar from above to below average in Ytd. Huge lifts in Apr, Jul & Aug kept Ytd above avg and above 24 from Apr>Aug.

Sport/Hobby/Book – They had drops in Jan>Feb. Feb was -6.4%. This turned Ytd all negative. Mar>May had increasing monthly lifts. June $ dropped but Jul & Aug had the biggest lifts in 25, turning Ytd Aug positive, +0.5%.

Department Strs – Both reports show drops every month, but Ytd was always better than 24. Their fade continues.

Club/SupCtr/Value/$ – They offer value and convenience, the biggest shopping drivers. Some $ stores are struggling but SuperCenters/Clubs are still going pretty strong. Besides the internet, one problem in sustaining strong growth is that they are running out of new customers. The Monthly report had a -0.2% drop in February and a -0.3% drop in March. The Ytd numbers look better. There are no drops, but the Aug Ytd lift is only +2.4%, 72% below avg and 17% below 24.

Miscellaneous – This is probably our favorite channel because it includes pet stores. They also have great performance. In the Monthly report, only the YOY lifts for Feb & Apr are below avg. All others are above avg. The Ytd report is even better. All months are above avg and Aug is +8.4%, 98% above average and 56% more than Y/E 24.

Nonstore – They are driven by the internet which has had the strongest growth and became the biggest $ channel in 2020. The Monthly & Ytd reports have similar patterns – all months below avg. Aug Ytd is +6.9%. That sounds great but it is -32% below avg & -15% less than 24. It is difficult, if not impossible to maintain double digit growth…forever.

Relevant Retail – They had no drops and 3 above avg monthly lifts – only 1 (Jan) in Ytd. Ytd shows Mar>Apr growth, a May>Jun pause, a small lift in July & a pause in Aug. The group’s Ytd performance in Apr>Aug exceeds +3.6% in 24 and Aug is +4.0%, only -14% below avg. Here is a summary and comparison of Jan>Aug Monthly to Ytd for the 11 channels.

       Monthly: Drops: 22; Below Avg Lifts: 37; Above Avg Lifts: 29

                Ytd: Drops: 29; Below Avg Lifts: 29; Above Avg Lifts: 30

Mon: Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 6; ↓Avg: 5; ↑Avg: 0; Mar: $↓: 2; ↓Avg: 5; ↑Avg: 4; Apr: $↓: 2; ↓Avg: 5; ↑Avg: 4

Ytd:   Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 4; ↓Avg: 5; ↑Avg: 2; Mar: $↓: 4; ↓Avg: 4; ↑Avg: 3; Apr: $↓: 3; ↓Avg: 3; ↑Avg: 5

Mon: May: $↓: 3; ↓Avg: 4; ↑Avg: 4; Jun: $↓: 2; ↓Avg: 6; ↑Avg: 3; Jul: $↓: 2; ↓Avg: 3; ↑Avg: 6; Aug: $↓: 2; ↓Avg: 5; ↑Avg: 4

Ytd:   May: $↓: 4; ↓Avg: 3; ↑Avg: 4; Jun: $↓: 4; ↓Avg: 3; ↑Avg: 4; Jul: $↓: 4; ↓Avg: 3; ↑Avg: 4; Aug: $↓: 3; ↓Avg: 4; ↑Avg: 4

The summary clearly shows a key difference between the Monthly & Ytd reports is in the lingering Ytd impact of big drops and lifts. Both views are critically important. Monthly shows what is currently happening in the marketplace and Ytd puts it into perspective. They also show trends over time. Ytd provides an overview while Monthly shows the details fueling the movement.

Inflation negatively affects retail growth both in the short term, with spikes or drops, and in the long term, with cumulative high prices. It can even have an impact before it happens. We saw this with pre-tarifflation “fear” buying. The current retail situation is not good. The YOY lifts vs 24 are generally below the long term avg for most channels. Retail “hit bottom” in Feb but most channels (not Gas Stations or Dept stores) showed improvement in Mar/Apr. The monthly situation worsened in May/Jun, improved in July, then fell back a little in Aug. Ytd it is stable & better than 24. Inflation is low but increasing in most categories. Prices are still high. We’ll see if tariffs have a noticeable impact.

Finally, for your reference, here are the July and August inflation rates for the CPIs of the retail groups and channels in this report. This includes special aggregate CPIs created with the instruction and guidance of personnel from the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data also includes the CPI changes vs 2021 to show cumulative inflation. The chart shows both monthly and Ytd inflation so it can be used as a reference for both measurements in the sales growth report.

Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)

  • In the Big Groups, Restaurants was unchanged. Gasoline is still deflating, but prices went up. Auto, Total & Relevant Retail also got worse.
  • The monthly inflation also worsened for 9 of 11 smaller channels
    • The biggest change was again Furnishings, but it was good. They fell from 5.2% to 2.6%.
    • There was 1 flip. Clothing went from -0.2% deflation to 0.2% inflation.
    • For 2 channels, the worsening was just a slower deflation rate
  • The 2 smaller channels with improved inflation were:
    • Furnishings (+5.2% to +2.6%)
    • Health & Personal Care (+0.1% to +0.04%)
  • Cumulative inflation vs 2021 is still high & relatively stable for most channels, especially Ytd

 

 

Retail Channel $ Update – July Monthly & August Advance

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In August, the Commodities inflation CPI rose to 1.3% from 0.7% and Total Retail sales were +3.5% vs 24, -25.6% below their avg August Lift. The Relevant Retail CPI rose to 1.6% from 1.2% and sales were +3.7% vs 24, -21.1% below avg. There are other factors impacting sales, including high cumulative inflation and pre-tarifflation binge buying. It is a complex situation. Progress has slowed and the problem with YOY drops and the size of sales lifts is still very real.

We’ll continue to track the retail market with data from 2 reports provided by the Census Bureau and factor in a targeted CPI. The reports are the Monthly and the Advance Retail Sales Reports. Both are derived from sales data gathered from retailers across the U.S. and are published monthly at the same time. The Advance Report has a smaller sample size so it can be published quickly – about 2 weeks after month end. The Monthly Report includes data from all respondents, so it takes longer to compile the data – about 6 weeks. Although the sample size for the Advance report is smaller, the results over the years have proven it to be statistically accurate with the Monthly reports. The biggest difference is that the full sample in the Monthly report allows us to “drill” a little deeper into the retail channels.

We will begin with the July Monthly Report and then go to the August Advance Report. Our focus is comparing to last year but also 21 & 19. We’ll show both actual and the “real” change in sales as we factor inflation into the data.

Both reports include the following:

  • Total Retail, Restaurants, Auto, Gas Stations and Relevant Retail (removing Restaurants, Auto and Gas)
  • Individual Channel Data – This is more detailed in the Monthly reports, and we’ll focus on Pet Relevant Channels.

The data will be presented in detailed charts to facilitate visual comparison between groups/channels. The charts will show 11 separate measurements. To save space they will be displayed in a stacked bar format for the channel charts.

  • Current Month change – % & $ vs previous month
  • Current Month change – % & $ vs same month last year and vs 2021.
    • Current Month Real change vs last year and vs 2021 – % factoring in inflation
  • Current Ytd change – % & $ for this year vs last year, 2021 & 2019.
    • Current Ytd Real change % for this year vs last year and vs 2021 and 2019
  • Monthly & Ytd $ & CPIs for this year vs last year and vs 2021 which are targeted by channel will also be shown. (CPI Details are at the end of the report)

First, the July Monthly. All were up from June and there were only 2 actual YOY sales drops, Gas Stations vs 24. Note: They are now selling more product than in 2019. 3 groups are “all positive”, the same as March>June. Relevant Retail has been all positive in 16 of the last 20 months and in 12 of the last 14. ($ are Not Seasonally Adjusted)

The July Monthly is $0.8B more than the Advance report. Restaurants: +$0.6B; Auto: -$0.1B; Gas Stations: +$0.3B; Relevant Retail: No Chge. All were up from June. A Jun>Jul increase in Total Retail  has only happened in 55% of the years since 1992 and the 3.9% lift was 13 times more than the 0.3% average. There were only 2 YOY drops in actual sales, the same as Mar>Jun. There was only 1 “real” sales drop, 2 less than May/Jun and down radically from 4 in April and 5 in March. 3 groups were again “all positive” (Mar>Jul). Restaurants still have the biggest increases vs 21 & 19 but Relevant Retail stayed at the top of “real” performance vs 2019. However, only 53% of their growth is real.

Now, let’s see how some Key Pet Relevant channels did in July (83% of July Ytd Rel Retl $)

Overall– 6 of 11 were down from June. Vs Jul 24, 9 were actually and “really” up. Vs Jul 21, 9 were up but only 5 were real increases. Vs 2019, Only Dept Strs were actually & really down but Off/Gift/Souv were really down.

  • Building Material Stores – The pandemic focus on home has produced sales growth of 29.8% since 2019. Prices for the Bldg/Matl group have inflated 19.7% from 21 and 23.1% from 2019 which is having an impact. Sales vs June were -0.1% for HomeCtr/Hdwe and -11.4% for Farm Stores. Vs other years, Farm stores are actually up for all, but Home Center/Hardware are only actually up vs Jul 21 & 2019. They are really down for all but vs 2019. Farm stores are only really down monthly & Ytd vs 21. Plus, only 18% of the Bldg Materials group’s 19>25 lift was real. Avg 19>25 Growth: HomeCtr/Hdwe: 4.1%, Real: 0.5%; Farm: 6.3%, Real: 2.7%
  • Food & Drug – Both are essential. Except for the pandemic food binge buying, they tend to have smaller changes in $. Vs June: Supermarkets: +4.6%; Drug: +1.7%. In terms of inflation, Groceries are over 20 times higher than Drug/Med products. Drug Stores are positive in all measurements and 68% of their 2019>25 growth is real. Supermarkets’ actual $ are up in all comparisons. They are only “really” down monthly and Ytd vs 2021. However, only 9.3% of their 19>25 increase is real growth. Avg 19>25 Growth: Supermarkets: +4.9%, Real: +0.5%; Drug Stores: +5.5%, Real: +3.9%.
  • Sporting Goods Stores – They also benefited from the pandemic in that consumers turned to self-entertainment, especially sports & outdoor activities. Sales are up 2.6% from June, but their only positives are vs Jul 24, 2019 & real Ytd vs 2024. Prices are still deflating, -1.3% vs 24. Deflation started in April 23 and is a big change from +1.1% in 22>23 and +7.9% in 21>22. This caused 68.5% of their 31.1% lift since 19 to be real. Avg 19>25 Growth Rate is: +4.6%; Real: +3.3%.
  • Gen Mdse Stores – Sales were +0.9% vs June, but all YOY sales – actual & real were up for Club/SupCtrs and $ Stores. Department Stores are negative in all comparisons. Their Actual sales are even -29.9% from 19 (Real: -36.5%). The other channels have an average of 42.9% in real growth. Avg 19>25 Growth: SupCtr/Club: 5.1%, Real: 2.3%; $/Value Strs: +5.4%, Real: +2.6%; Dept. Strs: -5.7%, Real: -7.3%.
  • Office, Gift & Souvenir Stores – Sales fell slightly from June, -0.7%, only -$0.02B. They are only really down monthly and Ytd vs 21 & 19. Their recovery started late, but their progress may be slowly restarting again. They have now been actually up vs 2019 for 2 consecutive months. Avg Growth Rate: +0.2%, Real: -1.4%
  • Internet/Mail Order – Sales are +7.4% from June to $121.1B, the highest Jan>Oct monthly $ales ever. All measurements are positive, but their YOY growth, +7.1%, is only 49% of their average since 2019. However, 83.0% of their 126.3% growth since 2019 is real. Avg Growth: +14.6%, Real: +12.7%. As expected, they are by far the growth leader since 2019.
  • A/O Miscellaneous – Pet Stores are 22>24% of total $. In May 2020 they began their recovery which reached $100B for the first time in 2021. In 2022 their sales dipped in Jan, Jul, Sep>Nov, rose in Dec, fell in Jan>Feb 23, grew Mar>May, fell Jun>Aug, rose Sep>Nov, fell Dec>Jan 24, grew Feb>May, fell Jun>Sep, grew Oct, fell Nov, rose Dec, fell Jan>Feb, grew Mar>May, then fell Jun>Jul. All comparisons are again positive, and they are in 2nd place, behind the Internet, in the % increase vs 19 and vs 21. Also, 77% of their 71.5% growth since 2019 is real. Average 19>25 Growth: 9.4%, Real: +7.6%

July had a big lift vs June. All Big groups were up but 6 smaller channels were down in $. The YOY July lift was 5.6% below avg for Total but 1.5% above avg for Relevant Retl – much better. Prices are only deflating in 1 channel (the same as June) but cumulative inflation still impacts sales as only 5 channels were really up vs July 21. The Retail Recovery slowly continues. The July commodities CPI of 0.7% rose to 1.3% in August. Let’s see if it impacts Retail.

Jul>Aug sales were only up for 3. A Jul>Aug Total Retail lift has happened in 82% of the years since 1992 but the 0.1% gain is 97% less than the +2.2% avg change. There were 2 YOY $ drops, the same as Apr>Jul. $ for all Big Groups but Gas Stations were up vs Aug 24 but the Total Retail lift of 3.5% vs Aug 24 was 25.6% below their +4.7% 92>24 avg. The Relevant Retail 3.7% increase vs 24 was 21.1% below their +4.7% avg. Inflation is still a factor. The CPI for all commodities is only 1.3% but it is still 11.8% vs 21. There is also some good “real” news. No “real” measurement was down – 1 in July, 3 in May>Jun. Plus, Gas Stations are again “really” up vs 2019 and now 4 Big Groups are all positive, up from 3 in Mar>Jul. Relevant Retail has been all positive in 13 of the last 15 months.

Overall Inflation Reality– The Total Retail CPI rose to 1.3% and the $ lift vs 24 fell to 25.6% below avg. The Restaurant CPI stayed +3.9% but their $ lift was now 14%  above avg. Gas prices rose to -6.5% but they are still in turmoil. Auto inflation rose to 2.6% but it is only 4.9% vs 21. Auto sales grew 3.0% vs 24, 34.8% below avg – pre-tariff buying over. Inflation rose to 1.6% for Relevant Retail. Their lift was 21.1% below avg but they are again all positive. Progress slowed.

Total Retail – Since Jun 20, every month but Apr 23, Jun 24 & Feb 25 has set a monthly $ales record. In 2023>25, Sales were on a roller coaster. Up Jul>Aug, down Sep, up Oct>Dec, down Jan 24, up Feb>Mar, down April, up May, down Jun, up Jul>Aug, down Sep, up Oct>Dec, down Jan>Feb 25, up Mar, down Apr, up May, down Jun, up Jul>Aug. Prices are 1.3% and YOY sales are +3.5%, 25.6% below the 92>24 avg change of 4.7%. 42.2% of the 19>25 growth is real. Prices are still inflating, and cumulative inflation is still impacting sales. Growth: 24>25: 3.8%; Avg 19>25: +6.2%, Real: +2.8%.

Restaurants – They were hit hard by the pandemic and didn’t begin recovery until March 2021. However, they have had strong growth since then, exceeding $1T for the 1st time in 2023. August $ are up vs 24 and they have the biggest lifts vs 21 & 19. Inflation stayed at 3.9% vs 24 but it is +24.1% vs 21 and +31.5% vs 19. Their 6.3% YOY lift is 14.1% above their +5.5% 92>24 avg. They are all positive again, but just 34.2% of their 57.1% growth since 2019 is real. They are 3rd in performance behind Relevant & Total Retail. Recovery started late but inflation started early. Growth: 5.5%; Avg 19>25:+7.8%, Real: +3.0%. They just account for 13.8% of Total Retail $, but their strong growth has helped Total Retail.

Auto (Motor Vehicle & Parts Dealers) – They overcame the stay-at-home attitude with great deals and advertising. They finished 2020 up 1% vs 2019 and hit a record $1.48T in 2021 but much of it was due to skyrocketing inflation. In 22, sales got on a rollercoaster. Inflation started to drop mid-year, but it caused 4 down months in actual $. Their YE real 2022 sales numbers were even worse, -8.2% vs 21 and -8.9% vs 19. 23 started a sales rollercoaster but the $ hit a record, $1.595T. $ fell in Jan 24, grew Feb>Mar, fell Apr, grew May, fell June, grew Jul>Aug, fell Sep, grew Oct, fell Nov, grew Dec, fell Jan>Feb 25, grew Mar, fell Apr>Jun, rose Jul>Aug. Aug $ were +3.0% vs 24. (34.8% below avg – pretariff buying over). They are now all positive, but just 24.9% of 19>25 growth is real. Growth: 4.7%; Avg 19>25: +5.3%, Real: +1.4%

Gas Stations – Gas Stations were hit hard by “stay at home”. They started recovery in Mar 21, and inflation began. Sales got on a rollercoaster in 22 but set a record, $583B. Inflation started to slow in Aug and prices slightly deflated in Dec & Feb 23, then strongly fell in Mar>Jul to -20.2%. In Aug they rose to -3.7%. In Sep they were +2.7% but began deflating to -4.2% in Feb 24. In Mar>May $ grew, fell Jun, rose July, fell Aug/Sep, rose Oct, fell Nov>Feb, rose Mar>May, fell Jun, rose Jul, fell Aug. Aug $ vs 24: -1.6% (4.9% avg) but up vs A/O years. Real $ are again all positive. Growth: -3.2%; Avg 19>25: +3.2%, Real: 0.04%. They show the cumulative impact of inflation and how deflation can be both positive & negative.

Relevant Retail – Less Auto, Gas and Restaurants – They account for ≈60% of Total Retail $ in a variety of channels, so they took many different paths through the pandemic. Their only down month until Feb 25 was April 2020, and they led the way in Total Retail’s recovery. Sales got on a roller coaster in 2022, but all months set new records with December reaching a new all-time high, $481B, and an annual record of $4.81T. In 2023, the roller coaster continued. A December lift set a new monthly record of $494.7B & an annual record of $4.997T. Sales fell Jan>Feb 24, rose Mar, fell Apr, rose in May, fell in June, rose Jul>Aug, fell Sep, rose Oct>Jan 25, fell Feb, rose Mar>May, fell Jun, rose Jul, fell Aug. The Aug 3.7% YOY lift is 21.1% below their 92>24 avg of +4.7%. They are all positive again and 53% of their 46.3% 19>25 growth is real, #1 in performance. Growth: 4.0%; Avg 19>25: +6.5%, Real: +3.7%. In 2024 their inflation rate dropped from 3.2% to 0.1%, stabilized at 0.5% Dec>Jan, rose to 0.7% in Mar, slowed to 0.6% in Apr, rose to 0.8% in May, 1.2% in Jun>Jul & 1.6% in Aug. Inflation is low, but its cumulative impact can slow growth. We’ll see what happens.

YOY inflation is low, but cumulative & impending lifts can affect sales. In Aug, 2 actual YOY $ comparisons were negative, the same as Mar>Jul. In Aug, there were no real drops – 1 in July, 3 in June. In July, Gas Stations were down vs 24, but all but Total had above avg lifts. In August, Gas Stations were again down, but only Restaurants had an above average lift. However, in August, 4 big groups were now all positive. Relevant Retail has now been all positive in 13 of the last 15 months. August sales rose vs July, but the lift size was much less than anticipated. The Retail recovery is slowing again.

Here’s a more detailed look at August by Key Channels (98% of August Ytd Rel Retl $)

  • Relevant Retail: Growth: +4.1%; Avg 19>25: +6.5%, Real: +3.7%.6 of 11 were up from July. Vs Aug 24: 9 were up, Real: 9, Vs Aug 21: 9 were up, Real: 7. Vs 19: Only Dept Stores were down – both actually & really.
  • All Department Stores – This group was struggling before the pandemic hit them hard. They began recovery in March 2021. Sales are +5.1% from July, but all actual & real YOY measurements are negative. Their -1.9% July YOY drop is much better than their -4.8% avg change. Growth: -2.7%; Avg 19>25: -5.9%, Real: -7.5%.
  • Club/SuprCtr/$- They fueled a big part of the recovery because they focus on value which has broad consumer appeal. $ales are +4.0% from July, and they are positive in all measurements. However, only 42.3% of their 35.0% 19>25 lift is real. Their 1.9% YOY Aug lift is -77% below their 92>24 avg of +8.4%. Growth: 2.4%; Avg 19>25: +5.1%, Real: +2.3%.
  • Grocery- They depend on frequent purchases, so their changes are usually less radical. Actual $ are -0.3% from July and positive in all actual comparisons. Cumulative inflation has hit them hard as real $ are down monthly & Ytd vs 21. Only 7% of 19>25 growth is real & their 3.0% YOY lift is 4.6% below avg. Growth: 2.9%; Avg 19>25: +4.8%, Real: +0.4%.
  • Health/Drug Stores – Many stores are essential, but consumers visit less frequently than Grocery stores. $ are -0.2% from July but they are positive in all comparisons. Inflation has been relatively low so 67% of their 35.7% 19>25 growth is real. However, their +3.3% YOY lift vs Aug 24 is 37.3% below avg. Growth: 6.6%; Avg 19>25: +5.2%, Real: +3.6%
  • Clothing and Accessories – Clothes mattered less if you stayed home. That changed in March 2021 with strong growth through 2022. Sales are +5.9% from July and positive in all measurements. 69% of their 19>25 growth is real. $ are +7.6% vs Aug 24, 1.5 times more than their Aug avg (pre-tariff buying). Growth: 4.8%; Avg 19>25: +3.3%, Real: +2.3%
  • Home Furnishings – In mid-2020 consumers’ focus turned to their homes and furniture became a priority. Inflation has slowed to 2.6%. $ are +1.5% from July and are only really down monthly & Ytd vs 21. However, only 18% of their 19>25 growth is real. YOY vs Aug 24: +2.9%, 9% below avg – pre-tariff buying over. Growth: 5.4%; Avg 19>25:+2.8%, Real:+0.5%
  • Electronic & Appliances – They have had many issues. Sales fell in Apr>May of 2020 and didn’t reach 2019 levels until March 21. $ are +1.1% from July but they are only actually up vs Aug 24 & 19. Strong deflation drove real numbers up, so all comparisons are positive. Sales are +2.6% vs Aug 24, 14% above avg. Growth: -0.6%; Avg 19>25: 0.6%, Real: +3.7%.
  • Building Material, Farm & Garden & Hardware – They truly benefited from the consumers’ focus on home. In 2022 the lift slowed as inflation grew to double digits. Prices turned up in Apr>Aug 25 and sales are -7.0% from July. Actual $ are only up monthly & Ytd vs 21 and vs 2019. Real sales are down for all but vs 2019. Just 15.8% of their 19>25 sales growth is real. YOY sales vs Aug 24 were -5.7%. Avg. is +4.3%. Growth: -1.1%; Avg 19>25: +4.4%, Real: +0.8%.
  • Sporting Goods, Hobby and Book Stores – Consumers turned their attention to recreation and Sporting Goods stores sales took off. Book & Hobby Stores recovered more slowly. They have been on a sales rollercoaster since June 24 and $ are +11.4% from July. Actual & real sales are now only down Ytd vs 21. 81% of their 19>25 growth is real. YOY Sales vs Aug 24 are +4.4%, 49% above avg. Growth: +0.5%; Avg 19>25: +3.9%, Real: +3.2%.
  • All Miscellaneous Stores – Pet Stores have been a key part of the strong and growing recovery of this group. They finished 2020 at +0.9% but sales took off in March 21 and have continued to grow. Sales are -4.0% vs July but positive in all comparisons. They are 2nd in the % increases vs 19 & vs 21 and 71.7% of their 51.3% 19>25 growth is real. Plus, their 6.8% YOY Aug lift is 63% more than their 92>24 avg of +4.2%. Growth: +8.4%; Avg 19>25: +7.1%, Real: 5.4%.
  • NonStore Retailers – 90% of their $ comes from Internet/Mail Order/TV. The pandemic accelerated online spending. They ended 2020 +21.4%. The growth continued in 2021 as sales exceeded $100B for the 1st time and they broke the $1 Trillion barrier. $ are -3.5% from July and their YOY lift of 8.2% is -21% below the 10.3% avg. However, they are positive in all comparisons and 82% of their 114.3% 19>25 growth is real. Growth: 6.9%; Avg 19>25: +13.5%, Real: +11.6%.

Recap – Driven by Relevant Retail, the Pandemic recovery was widespread by Y/E 2021. In 2022 we were hit with the strongest inflation in 40 years. Overall inflation has slowed considerably from its Jun 22 peak but again only 3 channels are deflating, down from 5 in May. Deflation helps, but cumulative inflation can still have a negative impact – slowed YOY growth and even sales drops. $ only rose from July for 6 of 11 channels. 5 of the 6 lifts were below avg and Relevant Retail was -0.6% vs a +2.9% avg. The biggest concern is still YOY drops and smaller lifts. Relevant Retail’s 3.7% lift vs Aug 24 was 21.1% below avg. 2 channels had a YOY drop vs Aug 24, 1 less than July but 1 more than June. 9 channels had YOY lifts, up 1 from July but down 1 from June. However, only 4 of the 9 lifts were above avg, down from 5 in July. Here is some good news. In Mar>Jul 3 Big Groups were all positive. That grew to 4 in Aug. In July, 5 smaller channels were also all positive, up from 4 in June. That stayed the same in August. Relevant Retail has now been all positive in 13 of the last 15 months. The situation is definitely mixed and still concerning as the progress is slowing.

Finally, here are the details and updated inflation rates for the CPIs used to calculate the impact of inflation on retail groups and channels. This includes special aggregate CPIs created with the instruction and guidance of personnel from the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data also includes the CPI changes vs 2021 to show cumulative inflation.

Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)

Here are some answers to some obvious questions. Note: All Relative Retail but Furniture, Drugs & Sporting Goods increased prices.

  1. Why is the group for Nonstore different from the Internet?
    • Non-store is not all internet. It also includes Fuel Oil Dealers, the non-motor fuel Energy Commodity.
  2. Why is there no Food at home included in Nonstore or Internet?
    • Online Grocery purchasing is becoming popular, but almost all is from companies whose major business is brick ‘n mortar. These online sales are recorded under their primary channel.
  3. 5 Channels have the same CPI aggregate but represent a variety of business types.
    • They also have a wide range of product types. Rather than try to build aggregates of a multitude of small expenditure categories, it seemed better to eliminate the biggest, influential groups that they don’t sell. This method is not perfect, but it is certainly closer than any existing aggregate.
  4. Why are Grocery and Supermarkets only tied to the Grocery CPI?
    • According to the Economic Census, 76% of their sales comes from Grocery products. Grocery Products are the driver. The balance of their sales comes from a collection of a multitude of categories.
  5. What about Drug/Health Stores only being tied to Medical Commodities.
    • An answer similar to the one for Grocery/Supermarkets. However, in this case Medical Commodities account for over 80% of these stores’ total sales.
  6. Why do SuperCtrs/Clubs and $ Stores have the same CPI?
    • Big Stores sell more fresh groceries, Groceries account for ¼ of $ Store sales. Same Ctgys – different mix.

Petflation 2025 – August Update: Slows to +2.5% vs Last Year

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The monthly Consumer Price Index peaked back in June 2022 at 9.1% then began to slow until it turned up in Jul/Aug 2023. Prices fell in Oct>Dec 23, then turned up Jan>Oct 24 but fell -0.1% in Nov. However, they have now risen for 9 straight months, including a 0.3% lift in August to a new record high. The CPI vs 24 also increased to +2.9% from +2.7% in July. Grocery prices rose 0.4% from July and their YOY inflation jumped up from 2.2% to 2.7%, the highest rate since 3.0% in August 23. Even minor price changes can affect consumer pet spending, especially in the discretionary pet segments, so we will continue to publish monthly reports to track petflation as it evolves in the market.

Petflation was +4.1% in Dec 21 while the overall CPI was +7.0%. The gap narrowed as Petflation accelerated and reached 96.7% of the national rate in June 22. National inflation has slowed considerably since then, but Petflation generally increased until June 23. It passed the CPI in July 22 but fell below it from Apr>Jul 24. It exceeded the CPI in August, fell below in Sep>Oct, rose above in Nov, then fell below in Dec>Aug 25. As we drill into the data, all reports will include:

  • A rolling 24 month tracking of the CPI for all pet segments and the national CPI. The base number will be pre-pandemic December 2019 in this and future reports, which will facilitate comparisons.
  • Monthly comparisons of 25 vs 24 which will include Pet Segments and relevant Human spending categories. Plus
    1. CPI change from the previous month.
    2. Inflation changes for recent years (23>24, 22>23, 21>22, 20>21, 19>20, 18>19)
    3. Total Inflation for the current month in 2025 vs 2019 and vs 2021 to see the full inflation surge.
    4. Average annual Year Over Year inflation rate from 2019 to 2025
  • YTD comparisons
    1. YTD numbers for the monthly comparisons #2>4 above

In our first graph we will track the monthly change in prices for the 24 months from Aug 23 to Aug 25. We will use December 2019 as a base number so we can track the progress from pre-pandemic times through an eventual recovery. This chart is designed to give you a visual image of the flow of pricing. You can see the similarities and differences in segment patterns and compare them to the overall U.S. CPI. The year-end numbers from 12 and 24 months earlier are included. We also included and highlighted (pink) the cumulative price peak for each segment. In Aug, Pet prices were down -0.2% from July. Products were down – Food (-0.3%); Supplies (-0.6%), while Vet & Services were both up (+0.1%).

In Aug 23, the CPI was +19.5% and Pet was +20.7%. The Services segments inflated after mid-20, while Product inflation stayed low until late 21. In 22, Food prices grew but the others had mixed patterns until July 22, when all rose. In Aug>Oct Petflation took off. In Nov>Dec, Services & Food inflated while Vet & Supplies prices stabilized. In Jan>Apr 23, prices grew every month for all segments except for 1 Supplies dip. In May Product prices grew while Services slowed. In Jun/Jul this reversed. In Aug all but Services fell. In Sep/Oct this flipped. In Nov, all but Food & Vet fell. In Dec, Supp. & Vet  drove prices up. In Jan>Mar 24 prices grew. In April, prices in all but Vet fell. In May, all but Food grew. In June, Products drove a lift. In July, all but Services fell. In Aug, Food drove a drop. In Sep, Products fueled a drop. Services drove a lift in Oct. In Nov, all were up. Prices dropped in March 25, but all but Food have set records since May.

  • U.S. CPI – The inflation rate was below 2% through 2020. It turned up in January 21 and continued to grow until flattening out in Jul>Dec 22. Prices rose Jan>Sep 23, fell Oct>Dec, rose Jan>Oct 24, fell Nov, then rose Dec>Aug 25 to a record high but 26.1% of the increase since Dec 19 happened from Jan>Jun 22 – 8.8% of the time.
  • Pet Food – Prices were at the Dec 19 level Apr 20>Sep 21. They grew & peaked May 23, then got on a rollercoaster. The ride continues in 25 – Jan>Feb↑, Mar>May↓, Jun>Jul↑, Aug↓. 99% of the lift was in 22/23.
  • Pet Supplies – Supplies prices were high in Dec 19 due to tariffs. They had a deflated rollercoaster ride until mid-21 when they returned to Dec 19 prices & essentially stayed there until 22. They turned up in Jan and hit a record high. They plateaued Feb>May, grew in June, flattened in July, then turned up in Aug>Oct to a new record. Prices stabilized Nov>Dec, but grew Jan>Feb 23. They fell in Mar, but the rollercoaster went on. Dec>Feb↑, Mar/Apr↓, May/Jun↑, July↓, Aug↑, Sep/Oct↓, Nov/Dec↑, Jan>Feb 25↓, Mar>May↑(record), Jun↓, Jul↑, Aug↓.
  • Pet Services– Inflation is usually 2+%. Perhaps due to closures, prices increased at a lower rate in 2020. In 2021 consumer demand increased but with fewer outlets. Inflation grew in 21 with the biggest lift in Jan>Apr. Inflation was strong in 22 but prices got on a rollercoaster in Mar>Jun. They turned up Jul>Apr 23 but prices fell in May. Jun>Aug↑, Sep>Dec↓, Jan>Mar 24↑, Apr↓, May↑, June↓, Jul>Nov↑, Dec>Mar 25↓, Apr>Aug↑, a record!
  • Veterinary – Inflation has been consistent. Prices turned up in Mar 20 and grew through 21. A surge began in Dec 21 which put them above the overall CPI. In May 22 prices fell and stabilized in June causing them to fall below the CPI. However, prices rose again and despite some dips they have stayed above the CPI since July 22. In 23>25 prices grew Jan>May, leveled Jun/Jul, fell Aug, grew Sep>Dec, fell Jan, grew Feb>May, fell Jun>Jul, grew Aug>Aug.
  • Total Pet – Petflation is a sum of the segments. In Dec 21 the price surge began. In Mar>Jun 22 the segments had ups & downs, but Petflation grew from Jul>Nov. It slowed in Dec, grew Jan>May 23, fell Jun>Aug, grew Sep/Oct, then fell in Nov. In December prices turned up and grew through Mar 24 to a record high. Prices fell in April, rose May>Jun, fell Jul>Sep, rose Oct>Nov, fell in Dec, rose Jan>Feb 25, fell Mar, set records in Apr>Jul, then fell in Aug.

Next, we’ll turn our attention to the Year Over Year inflation rate change for August and compare it to last month, last year and to previous years. We will also show total inflation from 21>25 & 19>25. Petflation slowed from 2.6% to 2.5% and it is now -13.8% below the National inflation rate. The chart will allow you to compare the inflation rates of 24>25 to 23>24 and other years but also see how much of the total inflation since 2019 came from the current pricing surge. We’ve included some human categories to put the pet numbers into perspective.

Overall, prices were up 0.3% from July and were +2.9% vs Aug 24, up from +2.7% last month. Grocery inflation jumped up to 2.7% from 2.2%. 3 had a price decrease from last month, up from none in July & May. There were 2 drops in Apr/Oct/Nov but 3 in Aug/Sep/Dec/Mar and 5 back in July 24. The national YOY monthly CPI rate of 2.9% is 16% above 23>24, but 22% below 22>23 and 65% less than 21>22. The 24>25 rate is also above 23>24 for Pet Food, Groceries & Med Services. In our 2021>2025 measurement you also can see that over 75% of the cumulative inflation since 2019 has occurred in 4 segments, all Pet – all but Services (72.0%). Except for Pet & Vet Services, where prices have surged, Service Segments have generally had higher inflation rates so there was a smaller pricing lift in the recent surge. Pet Products have a very different pattern. The 21>25 inflation surge provided 96% of their overall inflation since 2019. This happened because Pet Products prices in 2021 were starting to recover from a deflationary period. Services expenditures account for 63.8% of the National CPI so they are very influential. Their current CPI is +3.8% while the CPI for Commodities is 1.3%. This shows that Services are driving almost all of the current 2.9% inflation, but Commodities did drive the August increase. There is an even greater disparity in Pet, but products have a bigger share of $. Petflation is 2.5%. The combined CPI for the Service Segments is 5.1%, while the Pet Products CPI is 0.1%.

  • U.S. CPI– Prices are +0.3% from July. The YOY rate rose to 2.9% from 2.7%. It peaked at +9.1% back in June 2022. The targeted inflation rate is <2% so we are 45+% higher than the target. The Apr>Aug lifts follow Feb/Mar drops, 4 straight lifts and 6 consecutive drops from Apr>Sep 24. The current rate is above 23>24 and the 21>25 rate is still +18.4%, 70.0% of the total inflation since 2019. The Inflation surge took off in April 2021, +4.2%, up from 2.6%.
  • Pet Food– Prices are -0.3% vs July but +0.2% vs Aug 24. Prices have inflated for 2 straight months, but they are still far below the Food at Home inflation rate of +2.7%. The YOY Pet Food CPI has deflated in 15 of the last 18 months. The 2021>2025 inflation surge has generated 100.4% of the 22.6% inflation since 2019. Inflation began for Pet Food in June 2021, +0.9%, after 12 straight deflationary months.
  • Food at Home – Prices are +0.4% from July and the YOY increase rose to 2.7% from 2.2%. This is still radically lower than Jul>Sep 2022 when it exceeded 13%. The 30.5% Inflation for this category since 2019 is 16% more than the national CPI but only in 4th place behind 3 Services expenditures (2 Pet). 69.2% of the inflation since 2019 occurred from 2021>25. This is about the same as the national CPI, but we should note that Grocery prices began inflating in 2020>21 then the rate accelerated. It appears that the pandemic supply chain issues in Food which contributed to higher prices started early and foreshadowed problems in other categories and the overall CPI surge.
  • Pets & Supplies– Prices were -0.6% from July and the CPI dropped to 0% from +0.7%. They still have the lowest rate vs 2019. Prices were deflated for much of 20>21. As a result, the 21>25 inflation surge accounted for 85% of the total price increase since 2019. Prices deflated after Oct 22. 3 lifts pushed them to a record high in Feb 23. Prices fell March, rose Apr/May, fell Jun>Aug, grew Sep/Oct, fell Nov, grew Dec>Feb 24, fell Mar/Apr, rose May/Jun, fell July, rose Aug, fell Sep/Oct, rose Nov/Dec, fell Jan/Feb, rose Mar>May. (record), fell Jun, rose Jul, then fell in Aug.
  • Veterinary Services– Prices are +0.1% from July, but their YOY CPI vs 24 stayed stable at +6.4%. They remain #1 in inflation vs 24 and are still the leader since 2019 with +46.2% and since 2021, +36.6%. For Veterinary, high annual inflation is the norm. However, the rate has increased during the current surge, especially since 23. They have the highest rate in 25, and 79% of the cumulative inflation since 2019 occurred from 2021>25.
  • Medical Services – Prices turned sharply up at the start of the pandemic but then inflation slowed and fell to a low rate in 20>21. Prices were up +0.1% from July, but inflation vs 24 slowed sightly to +4.2% from +4.3%. Medical Services are not a big part of the current surge as only 61% of the 18.3%, 2019>25 increase happened from 21>25.
  • Pet Services – Inflation slowed in 20 but grew in 21. In 24 prices surged Jan>Mar, fell April, rose May, fell Jun, rose Jul>Nov, fell Dec>Mar 24 to 3.9%, Apr grew to 5.4%, May fell to 4.9%, rose to 5.9% in Jun & 6.3% in Jul, then fell to 5.8% in Aug. They are #2 in inflation vs 24, 21 & 19. 72% of their 19>25 inflation is from 21>25. In Dec 23, it was 49%.
  • Haircuts/Other Personal Services – Prices are +0.5% from July and +3.7% from Aug 24. 13 of the last 20 months have been 4.0+%. Inflation has been pretty consistent. 60% of the 19>25 inflation happened 21>25.
  • Total Pet– Petflation slowed to 2.5% from 2.6%. The biggest driver was that Products inflation slowed to +0.1% from 0.3%. 2.5% is -10.7% less than the 23>24 rate and 13.8% below the U.S. CPI. Plus, 2.5% is 19% below the average Aug Total Pet rate since 1997. Aug prices fell -0.2% from July. It was divided – Products down, Services up. A Jul>Aug decrease has only happened in 22% of the years since 1997 (avg Chge: +0.2%). The Pet CPI slowed from 2.6% to 2.5%, a minor decrease. Another factor in minimizing the CPI drop was that prices also fell in Jul>Aug 24. Pricing is very important in Retail Sales, but the CPI is a complex measurement.

Now, let’s look at the YTD numbers.

The 24>25 rate is lower than 23>24 for all but Medical Services & Groceries. The 22>23 inflation rate was the highest for all pet categories but Supplies & Services. 21>22 has the highest rate for Pet Supplies, Groceries and the National CPI. 20>21 has the highest rate for Haircuts & Pet Services. The average national inflation in the 6 years since 2019 is 3.9%. Only 3 of the categories are below that rate – Medical Services (2.9%), Pet Supplies (1.9%) and Pet Food (3.6%). It is no surprise that Veterinary Services has the highest average rate (6.6%), but all 4 other categories are +4.3% or higher.

  • U.S. CPI – The 24>25 rate is 2.6%, down 16% from 23>24, but it is down 42% from 22>23, 68.7% less than 21>22 and 33.3% below the average increase from 2019>2025. However, it’s still 79% more than the average increase from 2018>20. 76% of the 25.9% inflation since 2019 occurred from 2021>25. Inflation is a problem that started recently.
  • Pet Food – Ytd prices are still deflating, -0.3%, up from -0.4% in July and significantly up from -1.1% in Jan. That’s a big change from 0.9% in 23>24, 13.0% in 22>23 and even the 1.7% 18>20 average. It’s even below 20>21. Pet Food has the highest 22>23 rate but is only #4 in the 21>25 rates. Deflation in the 1st half of 2021 kept YTD prices low then they surged in 22 and especially in 23. 96% of the inflation since 2019 occurred from 2021>25.
  • Food at Home – The 25 inflation rate is double the 23>24 rate, but at 2.2%, it is down 67% from 22>23, 80% from 21>22 and even 4% less than 20>21. However, it is still 5% more than the average rate from 2018>20. It is only in 4th place for the highest inflation since 2019 but still beat the U.S. CPI by 13%. You can see the impact of supply chain issues on the Grocery category as 76% of the inflation since 2019 occurred from 2021>25.
  • Pets & Pet Supplies – A true roller coaster, prices rose Jan>Feb 24, fell Mar>Apr, rose May>Jun, fell July, rose Aug, fell Sep>Oct, rose Nov>Dec, fell Jan>Feb 25, then rose Mar>May. Prices vs 24 flipped from inflation to deflation in June, back to inflation in July, then slowed to 0.0% in August. Supplies still have the lowest inflation since 2019. Their biggest YOY lifts since 2019 were in 22 & 23. The 2021 deflation created an unusual situation. Prices are up 11.8% from 2019 but 109% of this lift happened from 21>25. Prices are up 12.9% from their 2021 “bottom”.
  • Veterinary Services – Inflation was high in 2019 and steadily grew until it took off in late 2022. The rate may have peaked in 2023, but it is still going strong in 2025, +6.3%, the highest on the chart. They are also #1 in inflation since 2019 and since 2021. At +6.6%, they have the highest average inflation rate since 2019. It is 69% higher than the National Average but 2.3 times higher than the Inflation average for Medical Services. Strong Inflation is the norm in Veterinary Services.
  • Medical Services – Prices went up significantly at the beginning of the pandemic, but inflation slowed in 2021. In 2025 it is 3.3%, 14% above the 2.9% 2019>25 average rate. We should also note that 3.3% is also 16.5 times higher than the lowest rate of 0.2% in 22>23.
  • Pet Services – After falling in late 2023, prices surged in 2024, then fell in 2025 until an Apr>Aug resurgence. The 24>25 inflation rate of 5.3% is 2nd, behind Veterinary on the chart. It is their lowest rate since 2020, but it is 96% more than their 2018>20 average rate. Pet Services is also 2nd in both 19>25 and 21>25 inflation.
  • Haircuts & Personal Services – The services segments, essential & non-essential, were hit hardest by the pandemic. The industry responded by raising prices. 2025 inflation is 4.1%, 24% below its 20/21 peak, but 24% above the 18>20 average. Consumers are paying over 30% more than in 2019, which usually reduces the purchase frequency.
  • Total Pet – 2025 Petflation is 2.1%, the same as July, but 22% less than 23>24. It’s also 9% lower than their 2018>21 avg. and 19% below the CPI. Petflation is still at its lowest rate since early 2021.This was primarily driven by deflation in Pet Products and lower inflation in Services. However, except for Mar & Aug, Pet prices have turned up in 25.

The Petflation recovery paused in Aug 24, came back Sep>Oct, paused in Nov, resumed in Dec>Jan, paused in Feb, restarted in Mar and paused Apr>Jun. Then July hit the highest rate in 2025, but it slowed in Aug. We tend to focus on monthly inflation while ignoring one critical fact. Inflation is cumulative. Pet prices are 24% above 2021 and 28% higher than 2019. Those are big lifts. In fact, current Aug prices for Vet & Services are the highest in history. Note: Total & Pet Products are within 0.7% of their record high. Only Supplies prices (+11.6%) are less than 22.6% higher than 2019. Since price/value is the biggest driver in consumer spending, inflation will affect the Pet Industry. Services will be the least impacted as it is driven by high income CUs. Veterinary will see a reduction in visit frequency. The product segments will see a more complex reaction. Supplies will likely see a reduction in purchase frequency and some Pet Parents may even downgrade their Pet Food. Products will see a strong movement to online purchasing and private label. At SZ and GPE 24 & 25, a huge number of exhibitors actively offered their OEM services. Strong, cumulative inflation has a widespread impact, but tarifflation can hit even harder. Supplies would likely be the most impacted by new high tariffs. We’ll see…

INFLATION’S IMPACT ON RETAIL SALES GROWTH – July 2025

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Inflation seems simple – just compare this year’s prices to the same time last year. In fact, it is more complex. The most important thing to remember is that it is cumulative so even when the YOY rate slows, it can cause a range of issues – selling less product and even a drop in $. One impact that is often ignored is slowed $ growth. That is the focus of this report. To give a better view of the situation we will include charts covering Jan>Jul 25 for the Big Groups and the “Advance” Relevant Retail Channels. We will include separate charts for Monthly & Ytd data to better show trends.

First the Jan>Jul Monthly Report for Big Groups (100% of U.S. Retail $)

We also included the Y/E numbers for 2024, both actual & average, to show our 1st goal – Beat these lifts!

Jan is arguably the best month, but Feb is definitely the worst. It is often the low point of the Retail year. In 25, the lift vs 24 was -78% below avg for Relevant Retail, but Total and all other groups had drops. A new positive is July. Gas Stations had their smallest monthly drop in 25, but all other groups had lifts, 3 above avg. April is still the best month of this period, with 1 drop but 4 above avg lifts, including Total. In May>Jun, the situation worsened. Still 1 drop, but only 1 above avg lift. June was a better than May, but the big improvement was in July, although the Total lift is still below avg.

Restaurants – The February drop was small and the Mar>May lifts were above avg. They peaked at 7.6% in May, 36.% above avg. Things worsened in June as their lift slowed to -1.0% below avg. July rebounded to +5.9%, 6.3% above avg.

Auto – Until May>Jun, their pattern was the same as Restaurants but with bigger changes, especially in Mar/Apr. The Mar/Apr lifts were basically double the avg. The 25% tariff was effective 4/3/25. Consumers saved thousands of dollars, but the binge buy ended in May, -59.7% below avg. Sales did bounce back in Jun/Jul, 14>27% above avg.

Gas Stations – They are definitely in turmoil. Sales fell Feb>Jul and until the -2.7% drop in July, all were bigger than 2024.

Relevant Retail – They do about 60% of Total Retail $. They have a similar pattern but now with 2 differences. The biggest is that they were +1% in Feb – no drop. #2 was in July. Their lift was 1.7% above avg while Total was -7.8% below avg. The Feb/Mar & May/Jun lifts were below avg while the Jan, Apr & Jul lifts were above avg. Their 23>24 lift was above Total Retail. In May & now July their lifts were much better than Total. Their progress continues.

Total Retail – They had a small drop in February, but March was basically equal to the avg. Jan & Apr were the only above avg months. All non-Feb months had lifts above the 3.0% 23>24 Y/E increase but the May lift was only +3.1%, -33.9% below avg. The situation improved in Jun>Jul, but the July lift is still -7.8% below avg.

 7 MONTHS JAN>JUL SUMMARY: $↓: 9; ↑Avg: 15; ↓Avg: 11

Jan: $↓: 0; ↑Avg: 4; ↓Avg: 1; Feb: $↓: 4; ↑Avg: 0; ↓Avg: 1; Mar: $↓: 1; ↑Avg: 2; ↓Avg: 2; Apr: $↓: 1; ↑Avg: 4; ↓Avg: 0;

                          May: $↓: 1; ↑Avg: 1; ↓Avg: 3; Jun: $↓: 1; ↑Avg: 1; ↓Avg: 3; Jul: $↓: 1; ↑Avg: 3; ↓Avg: 1;                               

Now let’s take a closer look at Relevant Retail. We will report on the 11 channels in our Advance report.

11 Relevant Retail Channels (98% of Ytd Rel Rtl $)

Relevant Retail – Their +3.6% lift in 24 was -22.8% below average. No drops in 25. The lifts for February, March, May & June were below average, but Jan, April & July were above average. The July lift is +4.8%, 1.7% above avg.

Furniture – No drops. Lifts were double the average in January, March & April but still big in May>Jul. The huge lifts in Mar>Jul were probably due to fear of skyrocketing prices from impending tariffs.

Electronics/Appliances – They have ongoing high deflation. $ Drops in both January & February. Sales turned positive in Mar, dropped in Apr>May, returned to positive, +0.7% in Jun, then dropped -1.7% in July. The 2 lifts were both below avg.

Bldg Matl/Garden/Farm – They had the smallest of the 4 drops in 23>24, -0.6%, but the 3rd biggest decrease (of 6) in Feb, -6.1%. They had lifts in Jan, Mar, Apr & Jun but all were below avg. The Jan, Apr & Jun increases were over 70% below avg. May (-2.8%) & July (-1.5%) brought 2 more drops but Feb was still the biggest of the year.

Grocery – Sales were only +2.0% in 24, -36% below average but they surged in Jan, 63% above avg. Growth slowed to 1% or less in Feb>Mar, 70+% below avg. They had a strong rebound in Apr. Sales were +5.8%, 93% above avg. The lifts slowed markedly in May>Jun, but increased in July to +3.4%, 10.6% above avg.

Health/Drug – Sales were +3.6% in 24, -31% below avg. The lifts grew to 4+% in Jan/Feb, surged in Mar/Apr to +8.9%, 75+% above avg, then slowed to +7.3% in May. In June, $ were +11.1%, 123% above avg. July was +5.4%, 3% above avg.

Clothing – 24 $: +2.5%, -19% below avg. A strong start to 25, but Sales fell -2.4% in Feb. However, the Mar lift was 1% above avg, then Sales “took off” in Apr to +6.9%, more than double the avg lift. The strong lift continued in May, +5.3%, 60% above avg. The binge buying ended in Jun as the lift slowed to +2.9%, but resumed in July, +7.4%, 127% above avg.

Sport/Hobby/Book – They were -2.8% in 24. This trend continued and hit bottom at -6.4% in Feb. In Mar>May they turned slightly positive, peaking at +2.0% in May, -39% below avg. June fell -1.1%, but July rose to +2.3%, 27% below avg.

Department Strs – It’s difficult to find something positive. They were -4.6% in 24 and had drops Jan>Jul in 25. The biggest drop was -5.9% in Feb and the smallest was -0.2% in July. Sort of good news: 5 of 7 drops in 25 were less than avg.

Clubs/SupCtrs/Value/$ – They offer value & convenience – 1 stop shopping. They have had strong growth from the start. COVID accelerated growth so it is no surprise that all lifts are below avg. They even had small <-0.3% drops in Feb/Mar. April improved to +5.3% but sales slowed to +3.5% in May and +1.4% in Jun. July rebounded to +3.3%, -61% below avg.

Miscellaneous – Pet Stores account for 15+% of this group’s sales. They had 2 below avg lifts, Feb & Apr. The Jan & Mar lifts were 80+% above avg and the May>Jul lifts were more than double the avg. They have the 2nd best performance of any channel, behind Furniture Stores, and they achieved it without the benefit of a pre-tarifflation buying surge.

Nonstore – 90% of $ are from internet/mail order (vast majority is internet). The Internet has had strong sales growth since its inception, but it skyrocketed due to COVID’s “stay at home” behavior. They have an avg lift of about 10%. Their 24 lift was +8.1%. From Jan>Jun, all lifts in 25 were below this and below average – no surprise. That partially changed with the +8.3% lift in July but it was still -20.9% below avg.            Low: Feb +5.0%; High: Jul +8.3%

SUMMARY

23>24: $↓: 4; ↓Avg: 6; ↑Avg: 1

7 MONTHS JAN>JUL: $↓: 21; ↓Avg: 32; ↑Avg: 24

Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 6; ↓Avg: 5; ↑Avg: 0; Mar: $↓: 2; ↓Avg: 5; ↑Avg: 4; Apr: $↓: 2; ↓Avg: 5; ↑Avg: 4;

                          May: $↓: 3; ↓Avg: 4; ↑Avg: 4; Jun: $↓: 2; ↓Avg: 6; ↑Avg: 3; Jul: $↓: 3; ↓Avg: 3; ↑Avg: 5;

In the above Summary, regarding Drops and Above Average lifts, a green number indicates the best and a red number is the worst. The best months are Mar, Apr & Jul. The worst is Feb. However, the biggest positive change occurred in March. 4 channels with drops turned positive. 3 became below average and 1 above average. 3 with below average lifts moved up to above average. The classification of 4 were unchanged so 7 fueled the improvement. April was the same as Mar. May was worse than April due to 3 drops. In Jun, Drops fell to 2 but above avg fell to 3. Note: 4+ has become the norm in above avg lifts. We can’t forget January. The number of positive lifts vs Y/E 24 moved up from 7 to 8 but the number with above avg lifts rose from 1 to 4 – a big change. Even with 6 drops/below avg lifts, the situation in July has greatly improved from 11 in Feb. The overall July CPI is low and stable from June, and 5 lifts are above avg, but the channels still had mixed performances.

Now let’s take a different view of the data from the Big Groups and the same 11 channels. Rather than monthly sales, we  will look at Ytd numbers. We will still view them monthly so we can see any trends.

The Ytd numbers are arguably the most important. In December, they become Year-End, which is the most quoted and remembered data in any year. While the monthly data shows what’s happening in the marketplace right now, the Ytd data consolidates the data. This blending extends the impact of big sales spikes – positive or negative. This can be either good or bad. The impact of the big drop in February 25 was lessened by the widespread Above Average January lift. It can also work the other way. The big February drop reduced the positivity of stronger lifts in Mar>Jul. Overall, progress stalled in May/June, then restarted in July. We’ll begin our analysis with the Big Retail Groups.

You notice that the spending patterns for Relevant & Total Retl are almost identical. Jan was good for all – 5 lifts, 4 above avg. Feb was bad. Gas Station $ dropped while the others had their most Below Avg lift. In Mar>Jul, only Auto had Above Avg lifts and only Gas Stations had any drops. Restaurants steadily improved but the others’ progress paused in May>Jul.

Restaurants – Sales for 24 were +5.2%, -7% below average. They flipped to above avg in Jan, then the lift radically slowed in Feb to +2.4%, -57% below avg. The situation steadily improved in Mar>May, then the progress slowed in Jun>Jul. Their YOY lift essentially stabilized at about +5%, -6>10% below avg for May>Jul. They did beat 24’s +5.18% with +5.22% in July.

Auto – Sales were +2.3% in 24, -47% below avg and the worst “positive” performance of any group. They turned it around in Jan with an above avg lift. The lift dropped to +2.0% in Feb, -56% below avg and the smallest lift of any positive big group. Their pre-tarifflation buying lift started in Mar/Apr, peaking at +5.9% in April, 33% above avg. In May>Jul the surge slowed, and the lift fell to ≈5%. They are the only Group with Mar>Jul above avg lifts.

Gas Stations – Whether you look at the data monthly or Ytd, they are doing bad. The Apr>Jul Ytd sales drops of over -3.4% are significantly worse than the -2.9% at Y/E 24. That does not bode well for 2025.

Relevant Retail – Except for Jan, +5.0% and now July, +4.1%, their YOY lift was stuck in the 3% range. Thanks to an Above avg monthly  lift, April Ytd, +3.9%, did finally exceed the +3.6% of 2024. The lift stayed at about +3.9% in May>Jun, -16% to -18% below the Ytd avg. A strong, +4.8% July lift restarted their Ytd progress to +4.1%, only -14% below avg.

Total Retail – The pattern matches Relevant Retail but the YOY changes for all, but Jan & Mar are smaller. With similar avgs, Total has bigger disparities. Total includes Auto & Gas Stations which have had extreme lifts & drops. Their Mar>Apr progress also paused in May>Jun and increased slightly in July, but their Ytd YOY lift has been above 24 from Mar>Jul.

                                                             Summary and Comparison of Jan>Jul Monthly to Ytd

                                                        Monthly: Drops: 9; Below Avg Lifts: 11; Above Avg Lifts: 15

                                                                 Ytd: Drops: 6; Below Avg Lifts: 20; Above Avg Lifts:  9

Mon: Jan: $↓: 0; ↓Avg: 1; ↑Avg: 4; Feb: $↓: 4; ↓Avg: 1; ↑Avg: 0; Mar: $↓: 1; ↓Avg: 2; ↑Avg: 2; Apr: $↓: 1; ↓Avg: 0; ↑Avg: 4;

Ytd:   Jan: $↓: 0; ↓Avg: 1; ↑Avg: 4; Feb: $↓: 1; ↓Avg: 4; ↑Avg: 0; Mar: $↓: 1; ↓Avg: 3; ↑Avg: 1; Apr: $↓: 1; ↓Avg: 3; ↑Avg: 1;

Mon: May: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jun: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jul: $↓: 1; ↓Avg: 1; ↑Avg: 3

Ytd:   May: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jun: $↓: 1; ↓Avg: 3; ↑Avg: 1; Jul: $↓: 1; ↓Avg: 3; ↑Avg: 1

The Ytd report levels the Feb>Jul data. You can see this in the orange numbers in the February Drops and the March, April & July Above Average Lifts. The Ytd situation isn’t good but it’s better than 24 for all but Gas Stations. Monthly, the Big Groups were stable May>Jun then improved in July. In Ytd data, Mar>Jul was stable.

Now, Let’s look at Ytd Sales for Key Relevant Retail Channels

The Ytd chart looks a little more consistent than the Monthly chart. This is true. Ytd extends the impact of big lifts or drops. The Ytd version has 22% less Below Avg lifts (middle ground), but 24% more Drops and 8% more Above Avg lifts. The result is balance. Ytd also has 3 channels that had drops every month in 2025. Monthly has only 1. However, Ytd has 2 channels with Above Average lifts every month. Monthly has none. It’s a complex situation. Let’s get into the specifics.

Furniture Stores – They are going strong. Their huge January lift pushed the February Ytd lift from below to above avg. Now, all months are above average. Tarifflation fear caused binge buying in Mar>Jul so the current lift is still huge.

Electronics/Appliance – Ytd they are all negative. This version hides the small Mar & June lifts. The positive impact in the Ytd chart was that their YOY drop slowed from -5.0% in February to -1.6% in Jun/Jul

Bldg Matl/Garden/Farm – Their big February drop turned March from a below average monthly lift to a -0.4% Ytd drop. In a reversal, Mar/Apr lifts made Ytd April slightly positive, +0.1%. Sales fell in May & Jul so Ytd May>Jul was negative.

Grocery – Their big Jan lift made  their Ytd situation look much better. However, Ytd essentially hid the huge above average lift in April and smaller one in July. Note: Ytd they have been above 24 Y/E in every 2025 month.

Health – Monthly & Ytd have a similar pattern – Jan/Feb, below avg; Mar>Jul, above avg. The June lift was huge, more than double the avg. The July lift was small, but Ytd is still 40% above avg and 97% better than 2024.

Clothing – Their big Jan lift eliminated the Feb drop in Ytd, but the Feb drop changed Mar from above to below average in Ytd. Huge lifts in Apr & Jul kept Ytd above avg and above 24 from Apr>Jul.

Sport/Hobby/Book – They had drops in Jan>Feb. Feb was -6.4%. This turned Ytd all negative. Mar>May had increasing monthly lifts. June $ dropped but July was +2.3%, the biggest lift in 25. Ytd is -0.4%, much better than -2.8% in 24.

Department Strs – Both reports show drops every month, but Ytd is better than 24. Their fade continues.

Club/SupCtr/Value/$ – They offer value and convenience, the biggest shopping drivers. Some $ stores are struggling but SuperCenters/Clubs are still going pretty strong. Besides the internet, one problem in sustaining strong growth is that they are running out of new customers. The Monthly report had a -0.2% drop in February and a -0.3% drop in March. The Ytd numbers look better. There are no drops, but the July Ytd lift is only +2.6%, 69% below avg and 10% below 24.

Miscellaneous – This is probably our favorite channel because it includes pet stores. They also have great performance. In the Monthly report, only the YOY lifts for Feb & Apr are below avg. All others are above avg. The Ytd report is even better. All months are above avg and July is +8.2%, 91% above average and 52% more than Y/E 24.

Nonstore – They are driven by the internet which has had the strongest growth and became the biggest $ channel in 2020. The Monthly & Ytd reports have similar patterns – all months below avg. July Ytd is +6.7%. That sounds great but it is -33% below avg & -17% less than 24. It is difficult, if not impossible to maintain double digit growth…forever.

Relevant Retail – They had no drops and 3 above avg monthly lifts – only 1 (Jan) in Ytd. Ytd shows Mar>Apr growth, a May>Jun pause and a small lift in July. The group’s Ytd performance in Apr>Jul exceeds +3.6% in 24 and July is +4.1%, only -14% below avg. Here is a summary and comparison of Jan>Jul Monthly to Ytd for the 11 channels.

                                                       Monthly: Drops: 21; Below Avg Lifts: 32; Above Avg Lifts: 24

                                                                 Ytd: Drops: 26; Below Avg Lifts: 25; Above Avg Lifts: 26

Mon: Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 6; ↓Avg: 5; ↑Avg: 0; Mar: $↓: 2; ↓Avg: 5; ↑Avg: 4; Apr: $↓: 2; ↓Avg: 5; ↑Avg: 4

Ytd:   Jan: $↓: 3; ↓Avg: 4; ↑Avg: 4; Feb: $↓: 4; ↓Avg: 5; ↑Avg: 2; Mar: $↓: 4; ↓Avg: 4; ↑Avg: 3; Apr: $↓: 3; ↓Avg: 3; ↑Avg: 5

Mon: May: $↓: 3; ↓Avg: 4; ↑Avg: 4; Jun: $↓: 2; ↓Avg: 6; ↑Avg: 3; Jul: $↓: 3; ↓Avg: 3; ↑Avg: 5

Ytd:   May: $↓: 4; ↓Avg: 3; ↑Avg: 4; Jun: $↓: 4; ↓Avg: 3; ↑Avg: 4; Jul: $↓: 4; ↓Avg: 3; ↑Avg: 4 

The key differences between the Monthly & Ytd reports are in the lingering Ytd impact of big drops and lifts. Both views are critically important. Monthly shows what is currently happening in the marketplace and Ytd puts it into perspective. They also show trends over time. Ytd provides an overview while Monthly shows the details fueling the movement.

Inflation negatively affects retail growth both in the short term, with spikes or drops, and in the long term, with cumulative high prices. It can even have an impact before it happens. We saw this with pre-tarifflation “fear” buying. The current retail situation is not good. The YOY lifts vs 24 are generally below the long term avg for most channels. Retail “hit bottom” in Feb but most channels (not Gas Stations or Dept stores) showed improvement in Mar/Apr. The monthly situation worsened in May/Jun, then improved in July. Ytd it is stable & better than 24. Inflation is low, but prices are still high. We’ll see if tariffs have a noticeable impact.

Finally, for your reference, here are the June and July inflation rates for the CPIs of the retail groups and channels in this report. This includes special aggregate CPIs created with the instruction and guidance of personnel from the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data also includes the CPI changes vs 2021 to show cumulative inflation. The chart shows both monthly and Ytd inflation so it can be used as a reference for both measurements in the sales growth report.

Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)

  • In the Big Groups, Relevant Retail inflation was unchanged. Gas prices went down. All others got worse.
  • The monthly inflation also worsened for 8 of 11 smaller channels
    • The biggest change was again Furnishings. They jumped from 3.4% to 5.2%.
    • There were no flips from deflation to inflation or vice versa.
    • For 2 channels, the worsening was just a slower deflation rate
  • The 3 smaller channels with improved inflation were:
    • Health/Drug (+0.2% to +0.1%)
    • Grocery (+2.4% to +2.2%)
    • Electronics/Appliances (-2.8% to -3.6%)
  • Cumulative inflation vs 2021 is still high & stable for most channels, especially Ytd