Page 102 - DMGT551_RETAIL_BUSINESS_ENVIRONMENT

Pavitar Parkash Singh, Lovely Professional University
Unit 5: Managing Retailing in Good Times and Bad

Unit 5: Managing Retailing in Good Times and Bad Notes

CONTENTS
Objectives
Introduction
5.1 Changes in Consumer Spending
5.2 Government’s Macroeconomic Policies in Retail Industry
5.3 Managing Fluctuations in Retail Industry

5.4 Dealing with Recession in Retail Industry
5.5 Maintaining the Balance in the Economy
5.6 Summary
5.7 Keywords
5.8 Review Questions
5.9 Further Readings

Objectives

After studying this unit, you will be able to:
Discuss the Changes in Consumer Spending
Explain the Macroeconomic policies in retail industry
Describe the concept of Managing fluctuations in retail industry

Discuss the concept of Dealing with recession in retail industry
Explain Maintaining the balance in the economy

Introduction

This unit helps the readers to understand the complexities of the economy within the context of
managing the retail business. It starts with those aspects of the macro economy that a retailer
would come across in reports relating to the current retail environment. The more important
factors effecting consumer spending, economic fluctuations, recession in retail industry are
discussed. This will lead to the practical issues in maintaining profitability and liquidity due to
change in economy.

5.1 Changes in Consumer Spending

Consumer spending patterns are shifting, and retailers must alter their strategies as past tactics
may no longer be effective. Director of Retail and Consumer Products Advisory Services, former
industry analyst Jeffrey B. Edelman, discusses that rather than relying on current pricing trends,
it is important for retailers to continue to focus on the customer to succeed in today’s marketplace.

Consumer spending habits are changing: A recent Women’s Wear Daily article discussed the
likelihood of reduced consumer expenditures on apparel and footwear through 2020,
approximately 2 percent, while overall spending could increase approximately one-third. Data
compiled by the U.S. Census Bureau note apparel and footwear expenditures have been trailing

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