Easter Could Prove Sunny for Food Retailers

(MoneyWatch)  For food retailers, the Easter season may be a bright spot in a gloomy year. According to IBISWorld, a research firm, grocery retailers will enjoy a 3.5 percent increase in food sales related to spring religious holidays. Households that are keeping their spending in check will prepare holiday meals at home rather than dining out, the firm asserted. Of course, this year Passover and Easter coincide, and that can have its own impact. Not only that, but Easter falls almost three weeks later than it did last year when it had one of its earliest occurrences in years.

The last factor is particularly important to sales of traditional seasonal products including candy. Last year, a lot of consumers were just getting over the end-of-year holiday season when Easter rolled round. This year candy producers and retailers have had 20 additional days to market and merchandise their products, and, as George Van Horn, senior analyst with IBISWorld put it, "entice the public to spend," which is fortunate, as maximum enticement is required these days to coax cautious consumers to part with cash.

IBIS world expects 55 percent of all Easter confectionary sales in 2009 to occur in supermarkets, supercenters and warehouse clubs, which the firm considers as a group for purposes of its research. Chocolatiers and specialty confectionary retailers will only generate about 18 percent of sales, the research firm estimates, with the remaining sales split among big box retailers, discount stores, convenience stores and online outlets.

IBISWorld stated that consumers will spend about $4.6 billion on food this Easter. On the not-so-bright side, year over year, it expects sales from all seasonal goods, including Easter clothing, candy, flowers, decorations, greeting cards and food, to fall from $14.8 billion in 2008 to $13.6 in 2009.