You’ve heard the trite, old expression above, probably used it a few times too. In the case of this economy (and this industry) let’s go over some recent “half-empty” indicators.
One of the major concerns about the economy from leading industry executives is about rising unemployment. The statistics are high, should get higher as the year goes on, and many economists think unemployment will lag any rebound from this recession next year.
Of course, if you read Mort Zuckerman’s column recently in the Wall Street Journal about unemployment, he said the situation is even worse than that. (He may be more depressed than some because his charitable trust lost $30 million to Bernie Madoff.) Reports said that even people with jobs are afraid they are the next to be laid off, so they are saving more and spending a lot less.
And there are signs that the economy is still taking its toll on the industry, as the auction of Ritz Camera and the closing of Anderson’s TV painfully illustrate.
As for the “glass half-full” side, I mentioned in a recent column some opportunities in this environment: Sixth Avenue Electronics and P.C. Richard & Son have expansion plans, based on the demise of Circuit City and the strength they have in their markets.
The most notable expansion is hhgregg, which said it plans to open 45 stores and a distribution center in the Baltimore, Washington and Philadelphia markets.
And on a smaller scale let’s not forget that in Northern Virginia three ex-MyerEmco executives have opened IQ Home Entertainment. Howard’s Appliance and Flat Screen Superstores, a member of the TWICE Top 100 CE Retailers list, based in Southern California, is opening its 10th location in September.
These expansionist retailers may be replacing the many jobs the CE industry lost with the demise of Circuit City and Tweeter last year. Or is it a drop in the bucket?
And is expansion in CE retailing sheer folly? The U.S. Commerce Dept. just reported that CE and major appliance sales were up by 1 percent in June. As many have told me this year “flat sales is growth” in this economy. And two big discounters, Costco and BJ’s, both reported that TVs and PCs were among their strongest categories in June.
The National Retail Federation reported last week that back-to-school spending is up for CE. Intel, in reporting its quarterly results, said the PC market has bottomed out and is upbeat about the industry’s prospects.
Problems surely lie ahead, but so do opportunities. The local economy businesses you operate may dictate your choice and view of the market. But I think that for many business owners and executives in this industry you have the power to either be a “glass half-empty” or “glass half-full” person. It’s in your hands.
This column originally appeared in the July 20, 2009 print edition of TWICE.