Ristow shed “some light at the end of the tunnel” to the credit crunch, as he presented a selection of vendor “specials” on core flat panel screen sizes procured for the group to help them through the Black Friday period and the days preceding it.
Ristow cited news reports that lending is becoming more readily available, with the LIBOR rate – the rate at which banks lend to other banks – having dropped to 1.5 percent, close to the usual average of 1.3 percent. “The good news is that as recently as yesterday, global efforts are starting to thaw the credit freeze,” he said.
He also spoke of the possible impact of Circuit City’s condition and actions on CE retailing industrywide. “As of yesterday, news was that they were considering closing up to 20 percent of their stores,150 stores, to stave off Chapter 11 so they don’t have to declare before the holiday season.” He conjectured that that move would allow them to use the closed stores’ inventory to “prop the company up, short term,” while it could also make them “more predatory.” On the assumption that they need to raise cash quickly, he said, price decreases could be the result. “We need to keep our eye on Circuit City, as they’re going to be a very interesting player in Q4,” he said.
“I would argue that there will be some opportunity in this for us,” he said to listeners, adding that, based on aggregate information from vendors, some box stores are pulling back on their forecasts. “There are high inventory levels out there right now, both at retail and wholesale. What we’re looking for now is who will blink first. We have not seen big price decreases from any vendors; they’re putting feelers out right now, and everybody’s seeing how to manage inventory.”
Ristow also cited CEA consumer survey results on the subject of Q4 electronics retail sales, which project an overall increase of 3.5 percent over 2007 figures, “so there will actually be a Christmas.” The stats also show 75 percent of adult respondents declared their intent to shop for CE during the holidays – up from 69 percent in 2007. Wish lists had notebook computers, TVs and mobile phones in the #1, #2 and #3 spots, with TVs up from fifth position last year.
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