Consumers Chicken Out at the Checkout Line
On ABC’s “This Week” on Sunday, both Paul Krugman and Robert Reich offered far more pessimistic views of the economy than the rosier outlook put forth by Federal Reserve Chairman Ben Bernanke on Friday. Krugman described the economy as languishing in purgatory. Reich explained that the only good news is that the economy is getting worse a bit more slowly.
One reason for concerns that any possible recovery may be less than robust is the continuing slowdown in consumer spending. And now there’s more evidence consumers aren’t going to be pulling out their wallets anytime soon and spending their way into an economic recovery. Via Mish’s Global Economic Trend Analysis, The Associated press [reports](d via Mish's Global Economic Trend Analysis,) that shoppers are chickening out in the checkout lines, leaving behind items they had planned on buying, just a short time earlier.
They’re leaving sweaters in the dress department, dumping cookies near the grocery cashier and waiting until the last minute to weigh wants versus needs. Online, shoppers are abandoning their virtual carts as they search for better deals.
People “want to be in the act of shopping, but they don’t want to be in the act of buying,” said Joel Bines, a director at AlixPartners, a turnaround consultant.
It’s more bad news for stores, of course.
It means more lost sales for stores at a time when there are already fewer customers because of the recession. For bricks-and-mortar shops already working with fewer staff, it also means more work because orphaned items have to be restocked.
Hard numbers are difficult to come by, but Burt P. Flickinger III, a retail consultant, estimates that in 25 percent of shoppers’ trips to the store, they’re ditching at least one item. In the recession of the early 1990s, it was 15 to 20 percent. In good times, it’s more like 10 percent.
Maybe you’ve done this yourself — you’ve gotten to the checkout line only to think twice, grab something from your basket, and dump it somewhere nearby. As the AP story points out, actual numbers on this trend are hard to come by. But think about it for a moment, and it makes sense — if you’re serious about cutting back on spending, you make these kinds of moves. And it’s also a sign of how much things have changed in the consumer psyche. Remember retail therapy? Shop until you drop? You don’t see those kinds of terms thrown around as much anymore. Shopping as entertainment just isn’t what it used to be, when you’ve had your hours at your job reduced or your neighbor’s house is in foreclosure.
With fears of a jobless recovery looming out there, it’s only logical that the latest consumer shopping trend would be leaving things behind — the stuff no one really needed in the first place.