Retail Industry and the Economic Impact

October 25th, 2011

Jonathan Dionisio

Last month, consumers held back on their purchases, which caused the market cast doubt on the retail industry and the economic recovery overall. However, the September retail sales showed consumers have renewed their purchasing power.

Retail sales increased by 1.1 percent, according to the Commerce Department data. Excluding automotive, overall retail sales were up 0.6%. Both figures were above the estimated results of several economists. Consumers spent mostly on clothing, furniture, electronics and appliances as well as construction-related materials.

Paul Dales, senior U.S. economist for Capital Economics said that the increase "shows that households are not completely down and out." On the other hand, Chris G. Christopher Jr., senior economist at IHS Global Insight, said the increase in spending was an improvement from the first half of the year.

However, Christopher stressed to “not break out the champagne”. “Things seem better on the consumer and retail fronts, but consumers still have many problems. “

Admittedly, the biggest challenge the retail industry faces is somewhat beyond their control. Consumer sentiment still reflects their reservation about the economy’s stability. The Thomson Reuters/University of Michigan consumer sentiment index for early October fell to 57.5 from an end-September reading of 59.4.

Despite the apparent issues of the retail industry, I still believe that retail businesses are ideal acquisition opportunities. With the holiday season coming up, it’s inevitable that the retail industry will post higher profits and consumer sentiments will eventually rise. The government is also doing its best through legislations and other measures to aid businesses and consumers alike. In the near future, the retail industry will be once again be viewed as a great investment for businesses and support the country’s rise to economic stability.

Start your acquisition process by searching in the retail industry for businesses for sale on Corporations4Sale.com.

Sources:
http://www.census.gov/retail/marts/www/marts_current.pdf
http://www.nytimes.com/aponline/2011/10/14/business/AP-US-Retail-Sales.html
http://online.wsj.com/article/SB10001424052970204002304576630721577336778.html
http://www.forbes.com/sites/steveschaefer/2011/10/14/better-retail-sales-googles-great-earnings-bolster-u-s-stocks/