The holidays are rapidly approaching, and right on schedule, economists are pondering their favorite $27.62 trillion question: Is the US economy headed for recession? Or will the post-pandemic boom continue?

According to an advance estimate, the latest GDP numbers show the US economy growing at an annual rate of 4.9% in Q3 2023—up from 2.1% in the second quarter and potentially marking the biggest increase since late 2021.

Retailers might be happy to learn that the increase in GDP reflects, in part, an uptick in consumer spending on both goods and services. But don’t get too excited. Nondurable goods such as prescription drugs were a major contributor to the increase, though recreational goods and vehicles also played their part.

• On another positive note, higher investment in private inventory bolstered the number, which reflects strength in both “manufacturing and retail trade.”

Yet some economists don’t see the good times lasting. Nationwide Chief Economist Kathy Bostjancic noted in a research brief that this level of GDP growth might not be sustainable, as the personal savings rate declines, employment gains slow down, borrowing rates increase, and inventory accumulation moderates.

Keep reading here.—AV

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Unilever said last week that it’s selling Dollar Shave Club to private equity firm Nexus Capital Management, as the CPG giant shifts its strategic focus to its top brands.

Financial terms of the deal, expected to close at the end of the year, weren’t disclosed, though Unilever will keep a 35% minority stake in the brand. It acquired the DTC men’s grooming brand in 2016 for a whopping $1 billion.

“This marks another step in our journey to transition our portfolio towards core strategic growth areas,” Fabian Garcia, president of Unilever Personal Care, said in a statement. Nexus partner Michael Cohen said the company will “serve as a platform for additional brands with a similar DNA.” Nexus also owns consumer brands like shoemaker Toms and food and beverage brand TruRoots.

Founded in 2011 as a DTC challenger to top razor brands like Gillette and Schick, Dollar Shave Club entered retailers like Walmart in 2020. But the brand’s performance was ultimately underwhelming, leading then-CEO Alan Jope to note in a 2021 earnings call that “Dollar Shave Club did not deliver as expected, and the economics of the DTC model changed.”

Keep reading here.—EC

Happy Halloween Eve, everyone. For those of you who won costume contests this weekend, we hope your hangover and Sunday scaries weren’t too bad. For those who saved their couple costumes for tomorrow, remember, all kids want is the big candy bar, and they don’t like to wear jackets over their costumes. We hope this helps.

Let’s get into what’s going on this week in retail.

In earnings: CVS will release its Q3 earnings report on Wednesday, which comes in the midst of an ongoing downsizing; in 2021, the company announced it would close 900 stores by 2024 as part of a new “retail footprint strategy.”

• CVS is hardly the only pharmacy taking such measures. Rite-Aid and Walgreens are also slimming down their physical footprints in the face of heightened competition from Amazon and pharmacies at big box chains, CNN reported.

Keep reading here.—KM

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