Wendy Liebmann, chief executive of WSL Strategic Retail, describes the economic scene as being in a state of "anarchy" and retailing is no longer immune from its deleterious affect.
"Americans cannot control the big things such as oil prices, falling home values, mortgage costs and rising property taxes, so they want to control the small things," Ms. Liebmann told Reuters. "They are watching what they spend on everything."
Ms. Liebmann said that her firm's research shows shoppers making fewer shopping trips and spending less on a whole host of discretionary spending categories including accessories, apparel, appliances, computers, electronics and perfume. Two categories defying the downturn are food and pet supplies.
A period where consumers are changing the way they shop offers retailers opportunity if they can make the necessary adjustments, she told the news service.
Ms. Liebmann believes that department stores have a major opportunity to achieve gains this year as they have developed product selections that better fit the lifestyle needs of consumers. She also sees a big upside for drugstores with improvements in the front-end beauty category and the addition of in-store clinics.
Mass merchants and specialty retailers are going to have a tough time in Ms. Liebmann's estimation as consumers continue to limit the number of trips they make to stores.
Discussion Questions: Do you share Wendy Liebmann's assessment of the current state of the economy and retailing? Are consumers making fewer trips and spending less when they do shop? What channels do you think are in the best position to weather an economic storm?