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Thread: The looming retail crisis

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    Default The looming retail crisis

    Retailers have been feeling the pinch for a long time now. Coming up to their busiest time of the year and they are having to lay off staff. After Christmas during January many of them will hit the wall with 10s of thousands of job losses.

    Retailers braced for major slump in Christmas sales - National News, Frontpage - Independent.ie
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Politics.ie Member
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    Retail is already the second highest hit sector for unemployment. It has been made clear that Retail is next to construction, though the numbers are way behind construction. Come Jan/Feb the numbers will get a lot closer.
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    Politics.ie Member hammer's Avatar
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    This will be a common thread for the next 3 years.

    If people dont have disposable income they cannot spend !!!!

    There wont be any wad of money coming from anywhere in the forseeable future

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    Politics.ie Member Marcos the black's Avatar
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    Hotels too... Many hotels are living on credit extended to them by suppliers, but suppliers are now coming knocking on their doors (Hey, where's that ten grand you owe us for milk?) and the banks are no longer prepared to prop them up. Come Jan watch hotel after hotel shut up shop....
    You'll never go broke appealing to the lowest common denominator.

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    Politics.ie Member hammer's Avatar
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    For the consumer the future Hotel model will be circa €20 per room per night. The bar will sell pints for about €3.50 and the restaurant will provide 3 course meals for about €20.It will be a long road with small margin and the bank debt will need to be extended to 100 year mortgages etc.

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    Moderator Cato's Avatar
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    There is going to be carnage in the retail sector at the start of the new year. Many retailers are hoping that Xmas will save the year, but it's not going to. Sales in stores are down year-on-year. People are simply holding on to any money they have. The budget will only make this worse.
    “I would rather be exposed to the inconveniences attending too much liberty, than those attending too small a degree of it." - Thomas Jefferson (yeah, I'm aware of the irony)

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    Politics.ie Member HarshBuzz's Avatar
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    Quote Originally Posted by Marcos the black View Post
    Hotels too... Many hotels are living on credit extended to them by suppliers, but suppliers are now coming knocking on their doors (Hey, where's that ten grand you owe us for milk?) and the banks are no longer prepared to prop them up. Come Jan watch hotel after hotel shut up shop....
    good, we have a ludicrous oversupply of hotels

    most of the new hotels are only staying open to avail of the ridiculous tax breaks which Cowen brought in
    “'retail deposit flight, I don't see that as a great danger. Ireland is an island” - Brian Lenihan - to hundreds of international investors

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    Politics.ie Member hammer's Avatar
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    Quote Originally Posted by Cato View Post
    There is going to be carnage in the retail sector at the start of the new year. Many retailers are hoping that Xmas will save the year, but it's not going to. Sales in stores are down year-on-year. People are simply holding on to any money they have. The budget will only make this worse.
    Same thing happened last year. Have a look at live register February 2009.

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    Moderator Cato's Avatar
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    Quote Originally Posted by hammer View Post
    Same thing happened last year. Have a look at live register February 2009.
    ...and the same thing is about to happen again.

    I agree on the above comments about hotels too, Carnage!
    “I would rather be exposed to the inconveniences attending too much liberty, than those attending too small a degree of it." - Thomas Jefferson (yeah, I'm aware of the irony)

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    Quote Originally Posted by ang View Post
    Retail is already the second highest hit sector for unemployment. It has been made clear that Retail is next to construction, though the numbers are way behind construction. Come Jan/Feb the numbers will get a lot closer.
    Grand, these are two sectors that we just don't need at the moment. The fall-off in construction, admittedly, does have knock-on consequencies for Irish based suppliers - but that has already happened at this stage.

    Retailers are generally selling stuff made elsewhere. So if they shut up shop, it just reflects that our imports should be reducing, which is quite positive in the circumstances.

    So a collapse of retail is really, really not something we should worry about. Any more than we should be worried about falling car sales.

    I suppose there's no hope those unemployed retail staff could get together with some unemployed builders and figure out something they can make and sell abroad. Seeing as how builders make stuff, and retailers sell stuff. Just a thought.
    Quote Originally Posted by HarshBuzz View Post
    good, we have a ludicrous oversupply of hotels

    most of the new hotels are only staying open to avail of the ridiculous tax breaks which Cowen brought in
    Absolutely, and if the hotel sector drops its prices it might reach a level when they can attract in some business from abroad - which is what will actually get us out of this problem.
    However, banks know they have a duty of care to their clients and I'm sure that this should prevent them lending irresponsibly.

    George Lee 2 June 2006

    Ziggy

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