What happens to the at-home economy when the pandemic ends?
What happens to the at-home economy when the pandemic ends?
A lot of products and businesses saw sales go through the roof during this pandemic. We were stuck at home, and we bought a lot of paint and furniture and exercise equipment and groceries.
“But now, the discretionary income that went towards that is going to start to go more and more towards travel and leisure,” said Randy Burt, a managing director at AlixPartners.
Air travel is recovering, Burt said. People want to be out in the world. But “everybody has a limit to what they can spend,” he said. “So they have to make a choice.”
And when faced with the choice between, say, new flooring and a trip to Puerto Rico, someone who’s been stuck at home for a year might lean toward the trip.
But predicting how much sales of all these things for the home will drop — if they’ll drop — gets a little complicated.
“I don’t see that all those categories will be suffering with people going back more to public life, because people also adopted more new habits in the pandemic, and some of them will linger,” said Denise Dahlhoff, a senior researcher at The Conference Board.
For instance, a lot of people who are currently working from home plan to continue doing that, which means they will still have those moments where they’re staring at that cracked, stained tile floor, thinking, “I just can’t look at this anymore.” So home improvement might do OK.
Eric Easter, CEO of Kittle’s Home Furnishings, a furniture and mattress store in Indianapolis, said another thing working in his company’s favor: The savings rate is at an all-time high.
“People’s individual balance sheets are stronger than they’ve been in many, many years,” he said. “So yes, they can probably take a trip, but they can also afford some new furniture.”
At least, that’s his hope.
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