It’s Weird Out There
Nov 6th, 2008 at 10:37 pm by Susie
The stores don’t have many people in them, and the prices are so low, they make me uncomfortable. It seems I’m picking up on a trend:
Indeed, the situation for retailers is so dire that it is creating opportunity for any consumers in a mood to spend money. Seven weeks before Christmas, stores are offering eye-catching bargains as they struggle to move merchandise.
“This is the year the consumer has been given a holiday gift beyond belief,” said Marshal Cohen, chief industry analyst for NPD Group. “You can get anything, anywhere, at any price.”
Malls are papered with sale signs, some seven feet tall and obscuring storefronts. New merchandise is being marked down before it even hits the sales floor. Stores are extending their hours and offering the kinds of deals — “doorbusters” — that are usually reserved for the day after Thanksgiving, known as Black Friday.
Kohl’s will stay open until midnight this Friday and offer an array of doorbusters, such as $250 diamond earrings for $77.99. Kmart is offering “early Black Friday” deals on Sundays, such as a Sylvania 32-inch LCD television for $439.99, instead of the usual $549.99.
I just completed my first year working a retail job and really have seen the business slow down in the last few months. I’m at a department store and it’s only specials and essentials that are bring people in to the store. For me it’s really bad as I’m selling mattresses and rugs and part of my pay is in commission and both those items are not high on peoples list of priorities when they’re worried.
I wish the lower prices extended to the supermarkets, where food prices remain just as high as when gas hit $4.
This is a deflationary environment. Cash is king (or queen if you prefer). The reduction in prices are a reflection of this, just as price increases are a reflection of inflation. Prices will continue to decrease as retailers and manufacturers reduce inventory to the point that is commensurate with demand.
I think supermarket prices will remain high for the time being because suppliers of food staples resisted raising prices during the commodities run-up. Now that they’ve capitulated, they have to make up losses and/or reduced profitability. Will they moderate? The consensus seems to be that once prices for things like milk go up, they stay up. And that’s that. But if there’s enough demand destruction, maybe they will go down too.