Industries that survive retail trauma

Ashley Milne-Tyte Mar 13, 2008


Doug Krizner: Later this morning we’ll get the numbers on February retail sales. Predictions are for anemic growth at best. If there’s any increase, it’s likely to reflect higher energy prices. At the risk of being too negative, Ashley Milne-Tyte reports on a few possible bright spots.

Ashley Milne-Tyte: People have to eat, even if many staples are getting pricier. So supermarkets should weather a downturn pretty well.

But Brian Bethune, an economist with Global Insight, says certain stores get fatter than others during lean times.

Brian Bethune: So we’re seeing, for instance, more shopping in Sam’s Club and Costco types of options, where people are trying to get more discounts or they’re buying in bulk as opposed to smaller quantities.

He says prescription drug sales are also immune to bad times.

Bethune: People, you know, when they need some health care, that’s an issue that’s not related to the economy.

But Scott Hoyt of Moody’s isn’t so sure drug makers will escape unscathed.

Scott Hoyt: Some people are gonna lose their health insurance because they lose their job. And if the pharmaceutical is at all discretionary, it’s gonna make them less likely to buy it.

Hoyt says no area of retail is entirely recession-proof.

I’m Ashley Milne-Tyte for Marketplace.

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