According to a recent survey carried out by a global research company, consumers across Australia, USA, UK and Canada are increasingly pessimistic about the economic future of the retail sector.
Datamonitor, an independent market analysis firm, has highlighted in its recent ‘Recession and Recovery research programme’ that consumers in the four countries listed above are wary of the economic ramifications on the sector and many predict that stores will continue to close in the near future.
From the 1,200 respondents, 78 per cent were convinced that more shops will close and UK shoppers were the most pessimistic with 89 per cent agreeing with the statement. Only 15 per cent thought more shops would open over the course of the recession.
“These findings are profoundly worrying for the retail industry and also for the commercial property sector” says Datamonitor’s global director of consulting for consumer markets, Neil Hendry.
“As we know consumer spending is under pressure globally, and the fact that consumers see more retail stores and chains closing would suggest they are pessimistic about their ability to be able to go out and spend in the short to medium term.”
Other results mentioned that consumers thought larger shopping malls would be unaffected by mass closures and therefore are opting to support small businesses.
“45 per cent of respondents claim they would start to buy more from local stores in order to support local businesses, and as a result 56 per cent felt their local shopping malls and high streets would be unaffected by mass retail closures,” he said.
Hendry highlighted that the worst thing about the findings is that consumers are losing confidence in their ability to spend.
“The most worrying thing from an overall economic perspective is that consumers are pessimistic about the retail sector – indicating they are also pessimistic about their own ability to spend. This means any consumer led economic recovery is going to be some way off, particularly as unemployment rates look set to continue to rise significantly over the next 18 months,” he said.