December 27th, 2011
05:45 PM GMT
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London (CNN) – Most of us have an idea of what we want to buy in the January sales - and maybe have budgeted the money in our holiday spending. I know I want to pick up a pair of jeans and some new brogue shoes. I would also like to buy a new espresso maker and maybe some towels. BUT - and this it the big point - ONLY if the price is right. I think I am not alone.

Christmas has been and gone and now in its wake we see a last-minute rush to sell before the end of the year. In the post-Christmas retailing blizzard the shoppers are there and some of them are even spending….. sales are expected to be up by up to 5% on last year’s. In London the shops were exceptionally busy with some stores seeing record numbers. (The day was marred by two high street stabbings that left one man dead).

When I went into the Gap store and saw them selling sweaters for £10 ($15), I realized that this was going to be a much harder time for the retailers - desperate to get rid of inventory, raise revenue and try to re-balance what has been a lackluster holiday season.

So this year’s sales - on both sides of the Atlantic - are more about how much the stores can make back, with the discounts eating into their margins. Some won’t make any money at all.  Or the horror scenario is that once the initial big-ticket savings have gone, the shoppers will evaporate too. 

The economic data in the U.S. suggests that the consumers still have some life in them yet. Consumer confidence numbers out this morning put the index at its highest level for eight months.  Apparently the spate of improving employment and retailing news in the run up to Christmas has had an effect - Americans are starting to feel better about the situation.

It would be seriously dangerous to overstate these developments because it is so very early in the trend.

There is still a great deal of uncomfortable news coming out. Just this morning, Sears Kmart, the retailer, announced it was closing 120 stores to save money and focus on more profitable outlets. That will be a reminder that things are still far from normal.

So I am ready to shop. Now I just have to make sure I can get what I want for the price I want to pay. Otherwise? I will just keep the money in my wallet for another day.

soundoff (5 Responses)
  1. PJ

    Too bad Richard Quest is viewed as such a twit here in the States. I would never trust his opinion. Obnoxious guy.

    December 27, 2011 at 8:13 pm |
  2. Frank

    No i don't think so temporarily maybe for very short time until housing market keeps going down we will having problem
    if you want to see the example go back and look at data back in 1980 to 1984 the economy did not jump start until
    real estate picked up

    December 27, 2011 at 8:56 pm |
  3. Warren

    Awesome! The people in china thanked you greatly for boosting their sales.

    December 27, 2011 at 9:50 pm |
  4. Cyrus

    Who came up with "consumer based economy"? It is the most short sighted thing I have ever heard in economy. This is just pass the hot potato and make me look good for election and let it be the next guy problem mentality. This type of short term thinking do nothing bu to increase debt and postpone the inevitable fall, only more painful. We need increase production and a balance trade of PRODUCED goods and services, not export of RAW MATERIAL.

    December 27, 2011 at 10:44 pm |
  5. Oresme

    All these articles sounds a lot like total brainwashing "go shopping !" would be the key message to main street... that's what all the media say and even W Bush said it after 9/11, he said, "Please help America, Go Shopping".

    Here are my 2 cents... "Go Shopping" means, "Show Some Trust in the Economy"... which is geting closer and closer to the soviet style brainwashing campaign "Support Our Leader, Look Happy". ...

    I think the US has passed many points of no return....I think it will be much worse before it gets better.

    When I read Richard Quest article above, I can't help it but to see that it is a lie, he does not think days ahead of the 5 dollars he may save on this towel or pair of shoes... americans are taken for a ride.... the media and special interests controls them big time.

    So sad.

    No wonder 88 milllions americans rely on Food Stamps.

    December 28, 2011 at 8:45 am |

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About Quest Means Business

Quest Means Business airs Monday to Friday, 1600 New York and 2100 London, and is hosted by Richard Quest.



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