By Sara Shea
With hundreds of retail stores closing last year the current state of America’s economy is weighing heavily on department stores. According to The New York Times, major retailers like Macy’s and Nordstrom reported the slowest pre-holiday season in over a decade.
On January 8, Macy’s announced the closing of 11 stores across the country after experiencing a 4.3 percent drop in sales last year, said AOL News. In contrast, clothing store Steve & Barry’s declared bankruptcy in July 2008 and more recently has announced the closing of all 173 stores.
“My hours have been cut in half,” says Marist sophomore Elise SchianodiCola. “My parents are feeling the pinch so I’m not counting on them for money.” SchianodiCola works at Express in the Poughkeepsie Galleria. Since she started in September, SchianodiCola has noticed a change in customer spending.
“Nordstrom customers are trading down to Macy’s, and the Macy’s customer is trading down to Target,” said Bill Dreher of Deutsche Bank Securities in an article for the New York Times. “That may account for strong sales at stores known for cheap chic — fashionable clothing and home décor at steep discounts [such as TJMaxx or Marshalls].”
“When I started working at the Gap in September I had at least one customer apply for a credit card every shift,” says Bailey Thomas Marist ‘11, “Now I’m lucky if I get one once a week.” With the economy in a recession and the credit industry in a crisis, consumers are reining in their spending and paying in cash.
Due to record low pre-holiday sales, stores are clambering to sell overstocked winter merchandise. “The sales are great,” says business marketing major Trey Savage. “But [the sales] kind of trick you into buying things you don’t necessarily need.”
Though some are optimistic about the upcoming season, most major chain stores expect the challenging retail environment to continue for the foreseeable future,” said The New York Times.
Retail stores are preparing for slow spring sales by ordering less merchandise and offering “doorbuster” deals to get customers in the store. By slashing prices, retailers are hoping to encourage consumer spending, thus reviving the ailing retail industry.