Big Picture: Prevent a Recession, Empower the Store Manager
Smart retailers, manufacturers and distributors who keep a close eye on regional sales trends would have noticed back then a slowdown in consumer and commercial spending patterns months before the government announced a “recession.” The bottom line is that local and regional retailers usually know when trends hit their markets long before any government agency acknowledges it.
Negative GDP numbers are far from being the sole indicators of a recession, mainly because they are subject to constant revision and reformulation. That’s why traditional analysts believe recessions are defined by two or more quarters of declining growth not negative growth.
This is the definition CE retailers should adopt in order to adjust their business models. Instead of waiting for government proclamations of an official recession, retailers have to keep an eye on those local and regional “lagging indicators,” such as unemployment, housing starts and commercial vacancies. Much of the current economic mess could have been avoided if these indicators were addressed early on.