Gift and Souvenir Stores

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 13,700 gift and souvenir retailers in the US sell gifts, novelties, souvenirs, and related merchandise. Major product categories include souvenirs, novelty items, kitchenware and home furnishings, clothing and jewelry, seasonal decorations, greeting cards, and toys. Companies may specialize in a particular category, such as Christmas merchandise, Halloween costumes, or party supplies. The industry includes national and regional chains, franchises, and independent operators.

Seasonal Sales

Gift giving is seasonal, and peaks during gift-related holidays, such as Christmas, Valentine’s Day, and Mother’s Day.

Vulnerable To Economic Conditions

Gifts, souvenirs, and novelty items are discretionary purchases, and demand typically drops during economic downturns.

Industry size & Structure

The average gift and souvenir store operates out of a single location, employs about six workers, and generates about $985,000 annually.

    • The gift and souvenir retail industry consists of about 13,700 companies that employ about 114,800 workers and generate about $13.5 billion annually.
    • The industry includes national and regional chains, franchises, and independent operators.
    • The industry is fragmented; the top 50 firms account for 47% of industry sales.
    • Large companies include Party City Holdings, Harry & David Holding, and Spencer Gifts. Most Hallmark stores are independently owned.
                            Industry Forecast
                            Gift and Souvenir Stores Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            May 4, 2023 - Mother's Day Spending to Reach Record Level
                            • Consumers plan to spend nearly $36 billion on Mother's Day in 2023, $4 billion more than the previous record high in 2022, according to National Retail Federation data reported in Gifts & Decorative Accessories. The most popular gifts to purchase are flowers and greeting cards, tied for the top spot at 74%. About 60% of consumers are expected to celebrate Mother's Day with a special outing, such as a restaurant meal. The per-person spending expected for the holiday is $274.02 in 2023 from $245.76 in 2022, reaching a record in the survey's history. The segment expected to spend the most is consumers aged 35 to 44, spending an average of $384.26. Consumers are shopping for Mother's Day gifts online (34%), and at department stores (34%), specialty stores (30%), local and small businesses (24%), and discount stores (23%).
                            • Consumer confidence levels fell in April 2023 after a slight increase in March 2023, according to data from The Conference Board. The Conference Board’s consumer confidence index dipped to 101.3 in April 2023 from 104 in March 2023. According to Ataman Ozyildirim, a senior director of economics at The Conference Board, “Consumers became more pessimistic about the outlook for both business conditions and labor markets. Compared to last month, fewer households expect business conditions to improve and more expect worsening of conditions in the next six months. They also expect fewer jobs to be available over the short term. April’s decline in consumer confidence reflects particular deterioration in expectations for consumers under 55 years of age and for households earning $50,000 and over.” Plans to purchase appliances, autos, homes, and vacations cooled in April 2023, a sign that consumers are pulling back amid reduced optimism, per Ozyildirim.
                            • The National Retail Federation (NRF) is projecting US retail sales growth of 4% to 6% in 2023, climbing to $5.13 trillion to $5.23 trillion. In 2022, retail sales grew by 7% to $4.9 trillion. The non-store and online sales segment is expected to grow by 10% to 12% in 2023 to a range of $1.41 trillion to $1.43 trillion. Much of the growth is driven by multichannel sales, which uses the physical store as part of the fulfillment process. Brick-and-mortar stores remain the primary point of purchase for consumers, accounting for some 70% of total retail sales. According to NRF President and CEO Matthew Shay, “In just the last three years, the retail industry has experienced growth that would normally take almost a decade by pre-pandemic standards. While we expect growth to moderate in the year ahead, it will remain positive as retail sales stabilize to more historical levels.”
                            • Even though they remain more expensive than conventionally marketed goods, sustainability-marketed products gained market share in 2022 and now account for 17.3% of purchases, according to a new report from Circana and the New York University Stern Center for Sustainable Business in Retail Dive. The sustainability-marketed products are more expensive than conventionally marketed items, with a 27.6% price premium. The five-year CAGR for the sustainable products category is 9.48%, compared to 4.98% for conventionally marketed products. Randi Kronthal-Sacco, senior scholar at the NYU Stern Center for Sustainable Business, states, “This year’s results definitively show that sustainable products survived inflation. In a clear nod to changing consumer preferences, we are encouraged to see that several large legacy brands have also begun to adopt sustainable benefits in their product lineup.”
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