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Continued: Housing bubble victims: Is retail next?

  • Article by: DAVID PHELPS , Star Tribune
  • Last update: August 18, 2007 - 5:20 PM

A survey by America's Research Group -- dubbed Consumer Mind Reader -- said nearly half of U.S. consumers would keep back-to-school spending to a minimum. Half the time, new clothes would be purchased only to replace items that students have outgrown, the survey found.

Beemer believes that consumers are holding off on back-to-school purchases until Labor Day weekend and beyond in anticipation of inventory markdowns to allow retailers to clear floor space for the not-too-distant Christmas season.

"Consumers want more deals," Beemer said. "The back-to-school season is now extending to Christmas." That trend he noticed for the first time last year.

NPD's consumer survey found three-fourths of respondents said they intend to spend $500 or less on back-to-school goods. "Consumers have a budget in mind and go shopping with the intention of spending those dollars," Cohen said.

But John contends that the "cultural, institutional and social" pressures of back-to-school spending may mitigate the gloom-and-doom fears of consumers.

"Students have to have some new clothes, new backpacks," John said. "It's socially acceptable."

David Phelps • 612-673-7269

David Phelps • dphelps@startribune.com

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