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Discounts can’t prevent retail pinch

Marketplace Staff Mar 21, 2008


Doug Krizner: The stock market says more about the future than the present. As the saying goes, think of it as a barometer, not a thermometer. And while Wall Street is trying to look past recession, Main Street is just starting to deal with it. Retail sales are falling — but some stores are doing better than others.

This week, discounter Ross announced good earnings. More off-price retailers are set to release numbers next week. Sally Herships has more on consumers dressing for less.

Sally Herships: Americans are stretching their dollars these days.

Marc Karimzadeh of Women’s Wear Daily says everyday shoppers aren’t splashing out as much.

Marc Karimzadeh: If you look at the past few months, Neiman Marcus and Sax have both reported that they feel the pinch of the recession in consumer traffic. They’ve seen a slowdown in their stores and on the floors.

But a down market doesn’t mean bad news for everyone. Analysts have high hopes for discounters like Fred’s, which releases earnings next week. But off-price retailers could still suffer from tight credit tight and high gas prices.

Retail consultant Howard Davidowitz says these stores aren’t recession-proof:

Howard Davidowitz: I think there’s lots of discounters feeling the pain right now, and by the way that includes Target and K-Mart.

Can any part of the fashion biz catch a break? Karimzadeh of Womens Wear says accessories makers could benefit as shoppers buy belts or handbags, rather than a whole new look.

I’m Sally Herships for Marketplace.

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