A .6% drop in retail sales for July versus small gains the previous two months means consumers still aren’t willing to part with their cash.
Paying off debt and saving more are more important to consumers now than spending money on anything other than necessities.
Department stores, electronics and furniture stores all took a hit. Even discounters didn’t fare particularly well.
The bottom line is that consumers aren’t opening their wallets. And that makes it exceedingly difficult for retailers to get customers into their stores without giving the store away.
And while some broad economic indicators seem to be pointing up, signaling the end of the recession and the beginning of the recovery, most retailers would say otherwise.
While not doing anything is surely a sign of defeat and means almost certain death, be careful and measured in what you are doing to drive traffic to your stores. Discounts are still working (just don’t give 50% off, ensuring you will not be profitable). Events, free gifts, discounts during specific days and more can help drive some traffic. Reducing overhead including payroll and inventory can go a long way to preserving your business, allowing you to ride out the storm.
How are you surviving in the down economy?
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