Big-Ticket Retailers Seeing Pickup in Sales
Consumers are spending more deliberately as the economic recovery gains momentum, according to analysts, and they are buying big-ticket items such as cars and appliances over clothing. Citigroup Deborah Weinswig says the consumer mindset has changed, and it now resembles the European approach to spending. “The consumer is more willing to spend on durables—cars and homes,” Weinswig says. “Even when they buy clothing, they’re buying investment pieces that will last them a while.” The shift is reflected in recent earnings reports, with home improvement chains such as Home Depot and Lowe’s posting healthy profit growth, while discount retailers are reporting disappointing sales figures. The low interest rate environment has made car and home purchases more attractive, analysts point out. In addition, more home owners seem to be willing to invest in their property as real estate prices rise. Case Design/Remodeling’s Bill Millholland says many consumers want to redo their kitchens and bathrooms and are spending money on expensive options. “They want nicer stuff,” Millholland says. “They’re really splurging on their homes.”
From “Big-Ticket Retailers Seeing Pickup in Sales”
Capital Business (09/02/13) Bhattarai, Abha