Bye-bye bargains: Retailers keeping inventory low

If the shoe fits, don't wait for a clearance sale.

Compared to the rampant fire sales and buy-one, get-one deals of last year, Florida shoppers can expect a very different experience shopping this year, as shops and malls reposition themselves and recover from abysmal downturns.

You're not going to see sales like you used to anytime soon, said Justin Greider, a retail leasing expert with Crossman & Co., who spoke in Tampa to a conference of retail and shopping centers. The overriding theme: How stores and malls can resurrect themselves from a dramatic downturn in consumer spending.

First the bad news for shoppers.

Stores are now stocking fewer sizes and fewer colors or types of merchandize, Greider said. Retailers spent last year dramatically cutting back on their inventory to help improve their balance sheets and stay profitable. And they're not stocking up anytime soon.

Often, stores have all their inventory on display, and their stock rooms are empty, Greider said.

Also, stores aren't holding huge clearance sales to any degree like they've done in past years. You're not going to see those 60- or 70-percent off deals, plus an extra discount for members of some sort, he said.

What sales there are will be much more targeted to certain items.

Now the good news.

Greider said the retailers who have survived are generally more healthy and willing to focus more on customers. There should be more sales staff on hand, and employees will be far more helpful.

If a customer comes in the door, retailers really can't let them leave without making a sale, Greider said. If that store doesn't have the size or color you want, stores are more likely to ship it for free to the customer's home.

This isn't just personal preference among store managers. There are powerful economic forces at work, notes K.C. Conway with the Federal Reserve Bank of Atlanta.

If it feels bad out there, it should feel bad, Conway said, speaking to mall managers, leasing agents and financiers. This recession is about twice as bad as anything we've seen since before World War II.

The retail economy is showing some signs that it's at least not getting worse, Conway said. But job growth has not picked up, he said, and residential real estate continues to be a drag on the economy, helping keep consumer confidence down.

How is any consumer going to feel confident spending on the retail side, Conway asked.

There are some huge problems looming, he said, especially with community banks that hold real estate holdings that are in poor financial shape. However, Conway said he's optimistic that now is a good opportunity for retail, primarily because the economics of retail are returning to much more rational levels that prevailed years ago.