During inflation, low-price retailers attract more buyers

U.S. consumer confidence fell more than expected in early March, according to preliminary data from the University of Michigan's consumer sentiment index, partly due to surging gasoline prices that pushed inflation to its highest level since 1982.

Those conditions have forced consumers to rethink how and where they spend their money. For consumers, low prices have become a key draw , giving companies like Biglots, Burlington and TJX, the operator of retailers including TJMaxx, Marshalls and HomeGoods, an increased opportunity to win new customers .

According to Salesforce's February inflation data, the number of orders in the United States in February fell 11.0% year-on-year, and the number of items per order fell 1.3% year- on-year . According to another report , inflation has prompted a large number of consumers to adjust their Valentine's Day shopping methods, with 32% of consumers choosing to shop in different stores. 19% of consumers turned to low-priced brands , and some consumers avoided buying certain products .

Suzy Davidkhanian, chief analyst at eMarketer , believes that every retailer has been affected by inflation. As consumer confidence declines, spending also declines. Although low-price retailers may win new customers by lowering prices , the overall market environment has led many consumers to buy only what they must have.

In response, low-price retailers must deal with multiple issues, including inventory problems caused by production restrictions and reduced levels of clearance merchandise. It is understood that retailers such as Nordstrom Rack in the United States are sourcing products from new suppliers to ensure they have enough inventory .

It should be noted that although the low-price strategy can attract consumers in the short term, in terms of long-term development, retailers need to provide experiences that go beyond "discounts" and "value" in order to increase repurchase rates and retain more buyers.

The effects of inflation are still ongoing in the United States, but as the tight labor market has led many companies to raise wages, there are reports that this may help ease some inflationary pressures.

inflation

Low price

attract