U.S. small- and mid-market retailers and suppliers think the doomsayers have it all wrong when they cast doubt on the health of the nation’s economy. In fact, a recent study shows, they believe consumer spending is better than last year and is gradually making a comeback.
The research found that 65 percent of retailers and 69 percent of suppliers believe consumer spending may return to 2007 levels by the end of this year, according to the survey by CIT Group prepared in association with Forbes Insights.
The report examines how middle market retailers (those with annual revenues of $25 million to $1 billion), as well as suppliers and manufacturers (those with annual revenues of $2 million to $1 billion) have weathered the recession and gauges their outlook for the future.
“While the majority of retailers are cautiously optimistic about their future, more than two-thirds expect revenues to grow over the next 12 months,” said CIT’s Burt Feinberg. “The general consensus is that, having weathered the economic downturn, most retailers are in better shape today than in 2009 and have positioned themselves well to meet future consumer demand when it returns.”
Retailers in particular, the report said, are looking forward to the upcoming holiday season. More than 68 percent are planning to hire more seasonal workers than in 2009 and more than 57 percent expect to stock more inventory than in 2009. But they anticipate highly competitive retail environment, with 69 percent saying they will advertise more aggressively and 72 percent expecting they will discount more this year than last.
Small- and middle-market suppliers show a similarly positive, but cautious, outlook. Seventy-four percent anticipate growth over the next 12 months.
To support that growth, 55 percent will make new investments in product development and 51 percent will put greater emphasis on operating efficiencies.