Growing up in a family that owned more than six small businesses, gearing up for the holiday rush was almost as anticipated as the first snowfall – sadly, sometimes more. That’s because during that time, a clear case between profit and loss for the year was established.
Like many businesses, it also meant we either stayed open another year, or we didn’t.
Fast-forward to 2009. We’re in the midst of one of the largest recessions North America has seen since 1929. According to Statistics Canada, in 2007 Canadians spent about a billion dollars more in the retail sector during the holiday months of October to January than in 2008. US figures are similar.
Experts agree the global financial meltdown has trickled down to consumers; the impact on consumer demand is palpable. However, though it appears people are still spending money – does that mean that the economy is actually rolling?
According to Dr. Lindsay Meredith, a marketing professor at Simon Fraser University, money spent during the holidays can influence the economy:
“The holiday shopping season is vital for the retail sector,” says Meredith, but as he points out, what may be more interesting to measure are what products people are purchasing – and how – during this time.
“Certain sectors are expected to suffer this year into 2010,” says Meredith.
“Mainly, the large ticket items will take the hit: televisions, home entertainment, furniture products; those kinds of things…deemed a ‘luxury’ product.”
“Numbers are not what they were,” says Erick Stockner, director of home theatre merchandising for consumer electronics giant Future Shop.
“We’re certainly down from last year, but we budgeted that and we still expect to have a strong holiday season.”
Not only that, but Future Shop says they’re going through a hiring blitz for the holidays, adding 5,000 seasonal associates by November 1.