In Retail, Fat and Slow Suffer Deepest Wounds
In any economic downturn, certain sectors will be hit harder than others. We've seen this numerous times in the United States as the farming, steel and aerospace sectors felt the weight of economic challenges. The same weight is now pushing down the retail sector.
Retail felt similar pressures in the 1980s, but this downturn is significantly different. Unlike the 1980s, in which economical realignments forced consolidation and change, this recession is driven by the constriction of consumer credit and the deep, root cause.
For the past 25 years, consumer electronics in particular has been the beneficiary of easy access to consumer credit and home equity credit. Unlike earlier trends within the CE segment, this one was quite different.