A friend of mine works for one of the largest retail liquidators in the nation (retail disaster).

[TomInTib]

I just got off the phone with him.

He told me they were sitting on $2.5 billion in inventory.

Then he told me that they project 20,000 retail stores to fold in 2009.

Wow.

I hope I'm not one of them.

[yardwork]

1. Does this mean that prices on those goods will drop?

Or will they be sold at list price by the few winners who gobble up all the other stores?

[TomInTib]

5. I didn't ask, I was in shock.

That is one hell of a lot of stores and employees.

I would imagine the retail prices will drop, because the liquidators will be paying literally pennies on the dollar. They are genarally paying 20% of wholesale, at present. I'll bet that will drop to less than 10%.

[yardwork]

12. It is shocking. I just figure that the vultures will find a way to keep the profits.

[LisaM]

2. Yikes.

Should I go shopping?

[notadmblnd]

4. wait till they ship it all to the dollar stores.

[AllieB]

3. Linens n Things just went bankrupt and couldn't find a buyer.

My favorite local fabric chain just went bankrupt and couldn't find a buyer. This reminds me of the early '90s when a lot of well-known retail chains disappeared.

[Peregrine Took]

6. I heard that, approximately, 3500 auto dealers will close in the next year. nt

[StClone]

7. I work Retail

And we are requesting no managers work Sundays (weekend pay rate is one and one-half). The average full-time employee is down to 35 hours a week on skeleton crews often with one person on duty in departments where 3-4 used to work. Inventory is about one-third of what we carried just last year. Our insurance deductible has gone up $1,000/ family plan. It is the worst I have seen it ever even with great sale items offered and often that's all people buy.

[Cirque du So-What]

8. K & R

The economy is definitely not pretty, but these snippets of reality deserve to be seen and heard.

[girl gone mad]

9. I hope you're not one of them, too, Tom. n/t

[CoffeeCat]

10. I spoke with a manager at Walgreen's....

...the other night. We had quite a long conversation about the
economy.

I was looking for something that wasn't in stock. She said that their
truck came in, but that the stock would not be on the shelves for
several days--because they have drastically cut work hours.

She said they are down to a skeleton crew, and that they weren't
getting stock on the shelf fast enough.

What's more basic than Walgreen's??? People go in there to get
their prescriptions, but also to buy everyday essentials and
other items.

There was a report about retail earnings, which noted that Walgreen's
had numbers healthier that most of their competitors. Yet, they're cutting hours. It's
scary. Walgreen's noted that they had held onto sales, unlike
other stores, because they were offering deep discounts and special
coupon offers to get people in the store.

What concerns me is that--yes, Walgreen's may be moving product due to
these sales and incentives, but that will increase their cost of sales.
They're essential paying people to come in the store. I can't imagine
that this is a good long-term model--because people are coming in and
buying ONLY these loss leders--and nothing else.

TominTib--thanks for posting this. These little tidbits that we hear
are much more useful and informative than anything we hear from the MSM.
My feeling is that the MSM is instructed to hide how bad it is, to avoid
being accused of causing further economic problems.

Yikes. I have a stomach ache. I hope your store survives Tom.

[dbt]

15. Your feeling about the MSM is dead on.

None of the TV networks will tell us how bad things really are. This is because they are all owned by gigundo corporations who have a LOAD of consumer goods to sell. GE, Viacom, Disney, TimeWarner and/or NewsCorp cannot afford to panic the audience. BAD for Business, y'know. Best to keep us all in the dark so we don't cut back!

:rofl:

[dixiegrrrrl]

11. I found some fascinating info. about liquidators:

Business is booming.
Industry sources say liquidators sell $5 billion to $8 billion worth of merchandise every year. This year is shaping up as exceptional, with an estimated $3.5 billion worth of goods being liquidated in the first quarter alone.

Most of the liquidation sales — which include store closings for merchants still in business as well as closeouts for those going out of business — are handled by a small fraternity that includes Hilco, Boston-based Gordon Bros. Group LLC, New York-based Schottenstein Bernstein Capital Group LLC and Great American Group and Nassi Group LLC, both based in the Los Angeles area.

http://www.hilcotrading.com/news/science.asp
and more via Google.

Wonder if they sell stock...hmmmm?

[CoffeeCat]

16. Where does this merchandise...

...from liquidators go?

Stores like TJ Maxx, obviously sell things that didn't sell somewhere else. I love that store. I don't
shop there often, but you can always get really funky, unusual things there.

Do other "regular" retailers and department stores buy this stuff as well, or does most of this stuff
go to discount and "dollar" stores?

Thanks for any info!

[dixiegrrrrl]

17. Goes to stores like Big Lots

Best of all, Habitat for Humanity has a "leftovers" store,
Worth a Google for locations, helps the non-profit.

In Mobile, there is a store called Old Time Pottery, has what looks to be JC Penny type
stuff, real cheap..picture frames, lamps, glassware..."hardgoods" as oposed to softgoods
like clothes, shoes.
We also have a "salvage" store, heavily discounted fixtures, garden stuff.

Google has lists of "discount stores". Names vary according to location.
I am sure they are doing a booming business these days.

[TomInTib]

24. My friend works for Hilco.

[craz3z]

13. In this article, too, it says

I'm not a big Jim Cramer fan, but like a lot of people he seems to have gotten a little religion after staring straight into the jaws of death. He recently wrote this:

Main Street will look different too. After years of overexpansion, retail’s going to be in massive retreat, except Wal-Mart, Costco, outlet malls, and a couple of Lowe’s. Amazon will become your de facto store, as it will be providing pretty much everything. By this time next year, Amazon could be rolling out national same-day service, which would be a real bricks-and-mortar killer, the last nail in the retailers’ coffin, not unlike what Google’s done to the media. Without job growth, we will have anemic auto sales, and by this time next year the big automakers will have burned through the subsidies they just received and either come back for more or, yes, declare bankruptcy, something that’s definitely on the table with this ailing group. And even though gasoline will come down, a sense of feeling poorer will still crimp travel and entertainment.

There is so much bad shit that has yet to go down from all this.

http://nymag.com/news/businessfinance/bottomline/51007/index1.html

[pam4water]

14. I've been waiting for price on shoes and clothign that is need to drop. They

haven't or haven't much. I watch from April to September to buy a pair of sneakers. They only drop $10 in price in that time. I needed a new winter coat I hated to by one now, but I gave up and did. I got on 25% off sale over the week end but he price was up 20% form last year.

[lligrd]

18. I Doubt Clothing And Shoe Prices Will Drop

We've been paying less than there worth for years. Nearly all are coming from countries where these goods could be made cheaply (at the expense of workers there). With our dollar losing ground and the countries that actually produce goods gaining ground and increasing pay these goods are bound to start costing more. When I was a kid, and clothing and shoes were made in the US, you typically only has one or two pair of shoes. I think we are heading back to that model. Heck, we might even begin producing our own again.

[World Traveller]

20. I think you're right

As dollar loses value, all imports will become more expensive.

I too remember those days, I was a child in hte '50's and a teenager in the 60's. In those days, when most clothing and shoes were made in U.S., you typically had maybe 3 pairs of shoes, one for school, one for dress-up, and one pair of Keds. Not that much extra clothing either, there was enough but not a lot. We used to re-cycle our clothes - when better clothes became worn, we used them as schlepping around the house clothes. Shoe repair was also a major business then, you had your shoes re-heeled and re-soled to make them last longer.

What I remember about Christmas is that you had to do your shopping early, if you wanted a good selection of merchandise. Less merchandise was in the stores by Christmas day.

Clothes and shoes were not cheap and plentiful as they are today, and relative to income they cost more.

But, really, it wasn't a bad way to live...we had enough...no one walked around barefoot or in rags. I think it's a worthwhile trade-off, so theat we can bring a few jobs back to the U.S. and provide employment.

We all want a better world where there is less poverty, but you have to help yourself, before you are in a position to help others. As a new America rises, with egalitarian leadership and more more equitable income distribution, we will be better positioned to provide sustainable help to rest of world.

[pam4water]

23. I am well aware of all that, but China has keep it's currancy fixed against the

dollar. The US dollar has varied maybe 5% verse the yuan. While the dollar has come down 25% to 60% against the rest of the world currencies, over 8 years of GWB. I've been disciplined for years about not buying any clothing or shoes that weren't on sale for at least 40%, because I knew it only cost only payed $5 to $20 for it in China. This year I have not been able to find sales, the prices are up by about 20%, but I know the crap from China has gone up by maybe 10%. The prices for the bottom end stuff that falls apart after a fee wearings has come down, but a lot of prices haven't come done. A good pair of sneakers cost what in the 1960 $30-$40. It shot up to $100 by the 1990s while production cost came down as they move every thing over sea then to China.

[earth mom]

25. When I was a kid in the 60s & 70s I only had one pair of shoes at a time. I think you're right. nt

[Ah Xoc Kin]

19. Retail numbers are in - decline double than expected

U.S. retail sales fell off a cliff in September, plunging by the largest amount in three years as worried consumers shunned the malls and auto showrooms in the midst of the country's financial meltdown.

The Commerce Department reported Wednesday retail sales decreased 1.2 percent last month, nearly double the 0.7 percent drop that had been expected. It was the biggest decline since retail sales fell by 1.4 percent in August 2005.

The bigger-than-expected decline significantly increased the risks of a recession because consumer spending is two-thirds of total economic activity.

Retail sales have now fallen for three consecutive months, the first time that has occurred on government records that go back to 1992.

http://www.msnbc.msn.com/id/27194806/

[MadrasT]

21. Is 1.2 percent "falling off a cliff" because the margins in retail are so low?

:shrug:

[Warpy]

22. A lot of retail stores aren't going to make it this year

because the Christmas season will likely be a very bad one. Even people with decent incomes won't be spending because they've been watching their 401K plans go into the toilet and they'll assume they're getting too poor for the mall, time to shop at K Mart, if at all.

Malls are going to be sad places by March. There will be a lot of empty stores by then.

This will increase unemployment and the vicious circle will be complete unless the government is capable of and willing to address the demand side of the equation.

Until that happens, we're going to be in a world of suck and we're likely to take everybody else with us.