Do businesses like Wayfair know that inequality is killing their business?

[applegrove]

That where Trump is heading only a third of the country will have disposable cash to spend? US economy will soon be like Mexico where Wayfair doesn't sell.



Never Mind the Internet. Here’s What’s Killing Malls.

Yes, the internet has changed the way we shop. But taken together, other factors have caused greater harm to traditional retail stores, an economist says.

By Austan Goolsbee at the NY Times

Published Feb. 13, 2020Updated Feb. 14, 2020

https://www.google.com/amp/s/www.nytimes.com/2020/02/13/business/not-internet-really-killing-malls.amp.html

"SNIP.....

It has been a tough decade for brick-and-mortar retailers, and matters seem only to be getting worse.

Despite a strong consumer economy, physical retailers closed more than 9,000 stores in 2019 — more than the total in 2018, which surpassed the record of 2017. Already this year, retailers have announced more than 1,200 more intended closings, including 125 Macy’s stores.

......


Income Inequality: Rising income inequality has left less of the nation’s money in the hands of the middle class, and the traditional retail stores that cater to them have suffered. The Pew Research Center estimates that since 1970, the share of the nation’s income earned by families in the middle class has fallen from almost two-thirds to around 40 percent. Small wonder, then, that retailers aiming at the ends of the income distribution — high-income people and lower-income people — have accounted for virtually all the revenue growth in retail while stores aimed at the middle have barely grown at all, according to a report by Deloitte.

As the concentration of income at the top rises, overall retail suffers simply because high-income people save a much larger share of their money. The government reports spending for different income levels in the official Consumer Expenditure Survey. In the latest data, people in the top 10 percent of income saved almost a third of their income after taxes. People in the middle of the income distribution spent 100 percent of their income. So as the middle class has been squeezed and more has gone to the top, it has meant higher saving rates overall.


......SNIP"

[PoindexterOglethorpe]

1. I don't shop very much or buy very many things because I'm older

and don't have the need for stuff that I had before. But when I buy clothes I have to be able to try them on. I'm only a semi-standard size, and the exact same size of something will fit differently, even if not necessarily made by a different manufacturer. Shoes are worse.

My disposable income is similar to what it's always been, I just don't buy stuff. I do tend to travel and use my excess money that way.

[applegrove]

2. Yes. The ageing of the country is part of it too. My point is Wayfair

and like businesses aimed at the middle class, but not aimed at the rich, should be very concerned with the Trump WH wanting america to be a mexico or russia or saudi arabia. They should be voting Democratic.

[KT2000]

3. blaming internet shopping

has covered up a seismic shift in income distribution.

[Wellstone ruled]

4. Wayfair owned by the Walton's

could give a crap less.

Watch for this to be BKed .

[KT2000]

5. Wayfair is owned by the Waltons?

did no know that and now I won't buy anything there. I looked at something on their site and now my Facebook is loaded with their ads.

[demtenjeep]

13. I did nto know that

makes my decision to not shop there even seems smarter

[applegrove]

6. Did not know that.

[Wellstone ruled]

8. Walmart.com links Wayfair.

They had been using different packaging.

[Wellstone ruled]

10. Ordered a Book Shelf from Wayfair and picked it up

at our Neighborhood Wallmart two weeks ago.

[applegrove]

11. Oh. I don't shop there very often at all. Glad i did not get a couch there.

[obamanut2012]

23. You didn't know it, because it isn't true

Wayfair was founded by entrepreneurs Niraj Shah and Steve Conine, and they still head the company, which is now public. The Waltons own no part of it, unless they are regular shareholders. I even just now checked the BOD, and again, no Waltons are involved there, either.

[obamanut2012]

22. Wayfair is NOT owned by the Waltons -- wtf

It was founded by entrepreneurs Niraj Shah and Steve Conine, and they still head the company, which is now public.

[applegrove]

7. Yes. And there is debt too. The middle class is so squeezed.

[Wellstone ruled]

9. Fourteen Trillion.

But,Mnuchin says that does not matter,you can just take out a HELOC,rates are great and their are plenty of Shysters to write you a loan. Yah right.

[Xolodno]

12. No.

I currently work in a distribution/sales function as an analyst. What do we study? What can we do to help our sales people sell more. That's it. Income levels, pricing, etc. nope. Not our problem. Pricing is a different department and their headache and have to trust they are doing the right thing.

And since I came from pricing...there concern is how to keep things profitable...sales, yeah, whatever. I have a funny feeling these two silo's are similar in many companies. None of them are taking an overview of everything and realizing, "hey, if people are poor, they can't buy our products". Henry Ford, the asshole and Nazi sympathizer he was, even realized you need people with income to buy your shit.

[applegrove]

14. That makes so much sense. All the middle class reliant retailers are

closing or cutting back. Of course they have silos. The country is in silos. That explains it all and why the GOP will fight to the end for Donald Trump because their 1%, at least 12 of them, have decided to end the New Deal and roll back the Enlightenment.

[smirkymonkey]

20. I also work for a very large consumer products company and although we seem to be doing fairly

well right now, what they don't seem to understand (as they lean right and lay people off regularly) is that the middle class is their bread and butter. If people are income insecure, they are not going to spend money on premium brands or are going to buy less of them. They don't seem to get that. They believe that growth is endless and always should be. It's like they have no concept of basic economic realities.

[Progressive dog]

15. I stopped shopping at Macy's decades ago

and Sears only after the stores began disappearing. The main retailer I physically shop at is Home Depot followed by Best Buy, Lowes, Kohls, and Target. Amazon has become my go to place for items that I don't need to see and can wait for. No one is going to willingly pay more for the same products except for convenience. There is more money being spent but more competition for it.
Using population data from the census of 256 million in 1992 and 327 million in 1918 together with real retail sales data from the Federal Reserve 119 billion/month in 1992 to 202 billion per month in 2018 (adjusted to 1982-1984 dollars), retail sales per person increased by approximately 33% and total spending increased about 70%, but still Sears and Kmart went bankrupt.

[applegrove]

16. You put 1918 on there at first. It should be 2018. I wonder how it has gone down from

2015? Or if the big box stores, owned by hedge funds, have taken away the good paying jobs as well as the business. Used to be smaller stores all had a manager.

[greytdemocrat]

17. BS

People in the middle of the income distribution spent 100 percent of their income.

That is a ridiculous generalization. Pure BS. Anyone with
a few brain cells should see thru this.

[applegrove]

18. Yes. They should have said 'much more' instead of '100%' of their income.

[greytdemocrat]

19. That's fine.

Never mind I know plenty of people like this
that don't and they know plenty of others.

I'm sure there are people that do all three.
But to make sweeping statements like this
are foolish.

[Recursion]

21. But more actual purchasing power is in the hands of consumers

Inequality is a red herring here. Ordinary people have more money and are spending more money. It doesn't matter that Jeff Bezos is theoretically worth whatever absurd some you get by multiplying Amazon's share price by the number of shares he owns.

[FormerOstrich]

24. Apathy

I think brick and mortar stores contributed to their decline by low wages and bad business practices.

I started shopping on Amazon, in spite of being reluctant to do so, because 1) lack of local owned alternatives and 2) Everything purchased had been previously returned.

It is much more convenient to effortlessly order than to return something one, two, three times because it isn't all there. Not to mention there is no customer service, to speak of anyway.

[KentuckyWoman]

25. Regarding malls - I used to go to Sears but that's it.

Our local hardware store closed up and we could not wait for the catalog order... so off to Sears about 2 hrs away. When Walmart opened the next town over it saved us a lot of driving.

99% of everything I own is privately made, hand me downs, yard sales, thrift stores or small local retailers. We lived in the country and not time, interest or money for the mall. If all of them die, I could care less. I feel for the people who lose jobs. I really do, but those monstrosities were bad from the start. Consumerism as a way of life was bad from the start.

Yes I'm an old lady. But all my life I'd rather have a couple pair of shoes made to fit my feet so I can walk all over without my legs breaking down... rather than 20 pairs of generic shoes that "will do". A few sets of clothes that actually fit my body well, cookware that holds up etc. I never saw any need for a walk in closet. I don't condemn those with closets full. To each her own... but my way of thinking is that buying things you don't really need .. you only steal from yourself.