Mar 1, 2009

Folks shopping… just not at high-end storesBy Max JarmanAZCentral.com

Shoppers who once paid $80 for a brand-name dress shirt at Dillard’s now flip through racks at Marshall’s, where a comparable shirt, maybe in an off color, costs around $40.

Marshall’s former customers browse Savers, where a used shirt, in good condition, goes for around $5. Or they cruise yard sales where a shirt can cost as little as 25 cents.

Consumers, who have been hit by falling home values, declining retirement accounts, layoffs and general economic insecurity, increasingly are stepping down the retail hierarchy in order to make ends meet.

The trend is reflected in a severe decline in consumer spending that has prolonged and exacerbated the recession.

The trend has been devastating to department stores at the top of the pyramid, which are reporting double-digit sales declines.

Revenues at discount stores, such as Marshall’s and Ross are down, but not nearly as much, while thrift and resale stores are reporting big sales increases, often in double digits.

“Shoppers are clearly looking for value alternatives,” said Mary Brett Whitfield, senior vice president of Retail Forward, a retail consulting firm in Columbus, Ohio.

“Consumers who are worried about their jobs and their 401(k)s are focusing on needs, not wants,” she said.

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