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Consumer confidence affects retailers
17 June 2008
Low consumer confidence is having a negative effect on the retail industry, according to the British Retail Consortium (BRC).
Household budgets have been tightened by the credit crunch and consumers are less likely to spend their reduced disposable income on non-essential goods like electrical products or leisure pursuits.
Richard Dodd, spokesperson for the BRC, said: "The underlying climate is quite difficult because customers are very short of spare cash and they have to focus their spending on essentials."
With consumer confidence continuing to plummet, jobs in the retail sector are at risk which has even more negative implications for the economy.
"People buying things generates wealth in the economy, supports jobs both in retail and also in manufacturing. So when people stop buying things or reduce their spending then that's bad news for the economy in a number of different ways," said Mr Dodd.
According to the BRC, sales of furniture and larger home products remained well down on a year ago, despite continued discounts.
