Make us your home page
On Retail | Mark Albright

Retailers brace for another tough year

NEW YORK — The evidence is piling up.

Retailers don't see an economic recovery kicking in until 2010, so they are digging in for tough times. They've cut back inventory so much that traffic of Asian imports into U.S. ports dropped 7 percent to its lowest point in five years, according to Port Tracker.

Stein Mart added 178 people to the 67,000 full-time retail jobs wiped out since Thanksgiving when it announced last week that two-thirds of its stores don't need a second assistant manager.

Even the fashion industry has a dour outlook.

"You're going to see a lot more black clothes in fashion because everybody on Seventh Avenue thinks shoppers will be bummed out until 2010," said David Wolfe, creative director at the Doneger Group, which tracks fashion trends for many chains.

After their worst holiday season in decades, the annual hand-wringing common among 18,000 executives gathered in New York City for the annual National Retail Federation convention this week has taken on a sense of relief that they survived Christmas. Now they're scrambling for new ways to prosper in the more frugal post-recovery world.

"It's tough out there," said Arnold Zetcher, former chief executive of Talbots and Bonwit Teller. "And nobody has been through anything like this, not even the 1992 recession."

Lee Scott, chief executive of Wal-Mart Stores Inc., said no forecast is as grim as the Great Depression, when 14 percent of all stores went out of business. "But I have no sense for when this economy will turn around," he said.

With more bankruptcies and store closings to come and tightening credit for retailers and credit card holders, stores have new tactics:

• Fashion trends are shifting from bling and conspicuous consumption. Premium denim will give away to just denim. Flashy jewelry will fade to simple stone cuts, gold, silver and pearls. By 2010, the fashion industry hopes shoppers will emerge from their funk to spring for brighter pastels and a push for another hot color, a jewel-tone green.

• Rising retail vacancies and shrinking rents mean many are weighing closing profitable and unprofitable stores. That's because rivals are vacating good spots that they can move into. By reconsidering all stores in a market, chains can get lower rents.

• Tight credit made it tougher for struggling retailers to get financing to survive in Chapter 11 bankruptcy, so more go directly to Chapter 7 liquidation. That means more price competition from more going-out-of-business sales.

• The Federal Reserve is pumping trillions in new money into the economy to head off deflation and stimulate the economy. Eventually, economists say, all that money will create inflationary pressure on prices. In the meantime, stores can sell goods for a lot more than they pay for them as consumers become more willing to buy before inflation eats away at the spending power of their dollars.

"We are entering a time when the economy is more reliant on government spending," said Carl Steditmann, chief economist for Deloitte Research.

Mark Albright can be reached at or (727) 893-8252.

Retailers brace for another tough year 01/12/09 [Last modified: Tuesday, January 13, 2009 7:23am]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Founder of Tampa home sharing platform questions Airbnb, NAACP partnership


    TAMPA — A Tampa rival to Airbnb, which was launched because of discrimination complaints on the dominant home sharing platform, has concerns about the new partnership between Airbnb and NAACP announced this week.

    Rohan Gilkes poses for a portrait at his home and business headquarters in Tampa. 

Innclusive, a Tampa-based start-up, is a home-sharing platform that focuses on providing a positive traveling experience for minorities. [CHARLIE KAIJO | Times]
  2. Appointments at Port Tampa Bay and Tampa General Medical Group highlight this week's Tampa Bay business Movers & Shakers



    Port Tampa Bay announced that Jamal Sowell has been named director of special projects. Sowell, a former member of the U.S.Marine Corps, will support internal, external and special projects, assist the executive team with management oversight and serve as a liaison on a variety of port …

    Port Tampa Bay announced this week that Jamal Sowell has been named director of special projects. [Handout photo]
  3. Drones restrictions coming at Tampa Bay area airports


    Starting Sept. 1, Tampa International Airport officials will be enforcing new height restrictions for drones and other unmanned aircraft systems, according to a press release.

    In this February 2017 file photo, a drone flies in Hanworth Park in west London. Starting Sept. 1, Tampa International Airport officials will be enforcing new height restrictions for drones and other unmanned aircraft systems,
[John Stillwell/PA via AP, File]
  4. Gov. Scott backs off boycott of companies doing business in Venezuela

    State Roundup

    TALLAHASSEE — Gov. Rick Scott will ask the Florida Cabinet next month to prohibit the state's investment managers from doing something they already do not do: invest in companies or securities owned or controlled by the Venezuelan government.

    Florida Governor Rick Scott interacts with people as he holds a Venezuelan Freedom Rally at El Arepazo 2 restaurant on July 10 in Miami. [Joe Raedle | Getty Images]
  5. Superior Uniform Group reports $65.6 million in sales for second quarter


    SEMINOLE — Superior Uniform Group Inc. reported sales of $65.6 million in net sales for the second quarter, up a percentage point from the same quarter last year, the Seminole-based company reported Thursday.

    Superior Uniform Group Inc. saw a sales increase for the second quarter, the company reported Thursday. Pictured is Michael Benstock, CEO. | [Courtesy of Superior Uniform Group]