Many economic factors affect retail sales which can have a positive or negative impact on businesses. The state of the economy decides the type of impact economic factors have on retail companies. The economy consistently faces factors that can change its growth and decline, thus affecting everyone.


Technology plays an increasingly important part in the retail industry. Many consumers and some businesses shop online. Shops that have yet to jump on this trend face lower sales, creating financial problems. Large retail stores understand the positives of online availability. Not only does it provide convenience to customers who have busy lives, but it can eliminate in-store marketing campaigns. A lot of retail outlets carry discount coupons or promotional codes on certain merchandise, making their sales soar.

Population Growth and Tourism

As the population increases it will determine the amount of retail sales. This depends on which demographic is larger--newborns or baby boomers. Currently, baby boomers are not in a position to spend, since they are reaching the age of retirement. In addition, the number of dependent people--those under the age of 14 and over the age of 65--ranks quite high. The people in the middle years, who are taking care of the dependents, have less disposable income causing a negative impact on retail sales. However, certain communities create opportunities for economic boosts. Concerts, festivals or large sporting events serve as tourist attractions. This brings extra money into the area and increases purchasing in the retail sector. The money earned by businesses during these events helps them survive during their down time.

Advertising Tactics

Advertising and marketing strategies play a vital role in the retail sector. Campaigns work to promote sales or new items in the store. During these economic hardships, companies can't always afford to pay for a marketing department. Smaller retail corporations suffer most, as they simply try to keep their head above water even when their sales rise.