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October 05, 2021

Shoppers shifting priorities in recession

The U.S. auto sector, driven largely by the Cash for Clunkers program -- where buyers were given rebates of up to $4,500 to trade in older vehicles and purchase new, more fuel-efficient cars -- gave retail sales numbers a brief boost last month. But can it continue?

Despite the fact that much of America is on sale, most of us continue to keep our hands in our pockets. The more shoppers expect prices to fall, the less they buy until prices drop, it seems.

Still, not all retailers are faring worse than they did a few years ago, reports the New York Times.

Against a baseline of spending levels in 2003, sales in computer stores have continued to rise. Restaurant and liquor-store sales are at much higher levels, and purchases at warehouse stores are up nearly 50 per cent. 

More shoppers also seem to be buying their staple products at discount stores and then the remaining groceries at open markets or specialist food outlets like butcher shops and bakeries.

With so many buyers hunkering down, some unlucky companies face the task of peddling their products to people who simply don't want to spend money. Who's lagging? Home furnishings and clothing. Sales have dropped off the map and are now below their levels of 2003, the Times reports.

The big winners in this ailing retail landscape seem to price-led players. For example, consumers increasingly shop at IKEA, rather than traditional furniture stores even though there may be a quality tradeoff.

Tell us: Have your shopping patterns changed significantly over the past year?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...