Times are tough- skip the workout and have some fries


As one would expect, with the current economic situation, the consumer industry has been greatly affected. Americans are re-evaluating extracurricular activities in order to pinch pennies. Telsey Advisory Group (TAG), an independent equity research and consulting firm focused on the consumer sector, has countless evidence of the recent changes in consumer behavior. In their online newsletter, TAG News, TAG counted 34 retail and restaurant companies which have filed for Chapter 11 bankruptcy this year.  Additionally, the U.S  Department of Commerce reported that U.S Retail sales dropped 1.7% in November marking the fifth straight month of declines. Compared to 2007, retailers are down a total of 7.4%.

There are however, a few companies that are faring well- mainly bulk retailers like B.J’s Wholesale Club and the Dollar Tree Inc.. America’s Research Group, a consumer behavior survey research company focused mainly on the retail sector, announced Wal-Mart as the winner for this Christmas. 69.1% of  consumers reported having been there.. In their Christmas Survey the top purchases at Wal- Mart were toys up 2.1% from 2007, videos up 9.7%, followed by electronics. Wal-Mart’s sales have risen 3.4%, exceeding estimates of a 2.1 % gain. “Wal-Mart is well-positioned for this environment,” said Joe Feldman of Telsey Advisory Group. “They are the only ones that are winning in this space. It’s going to be challenge for everyone else.”

Industry analysts also expect to see an increase in revenues at waiter-free casual restaurants. Instead of spending an average of $18.00 at T.GI. Fridays, Americans are heading to restaurants such Panera Bread and Chipotle where they can get a meal for under 10 bucks with no tip required.  Industry analysts have reported that casual sit down restaurants, i.e. Chili’s, and T.G.I Fridays, are seeing a decrease in customers and increase in commodities.  Upscale restaurants have made readjustments to stay afloat opening for brunch, lunch, and dinner, extending hours, and revamping menus.Americans also seem to be giving up extras such as gym memberships. Declines in memberships are sweeping the nation. Earlier this month Bally Total Fitness filed for Chapter 11 bankruptcy. Interestingly enough, churches and psychics have seen a rise in attendance.


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