Why groceries are becoming a big deal for retailers
With consumers growing more discerning, which sectors of retail will best wade through times of uncertainty?
JLL Americas President of Retail Naveen Jaggi joins Asking For A Trend to discuss the state of the consumer and how retailers may fare during this environment.
Jaggi points to Walmart (WMT) and Target (TGT) as two companies that are targeting cash-strapped consumers by lowering prices, but that overall, "the consumer is very strong."
He notes, "We've seen luxury sales have softened a little bit. So that tells me that even at the high end, that high-end consumer... they've taken that spend back, and they've pulled back a little bit on that angle. Meanwhile, we see the retail spend on the value retailers continue to do well and as we've seen and said, for the last better part of 2 or 3 years, that middle kind of classic legacy retailer is the one that is now seeing their dollar shifting mostly to the value side."
Jaggi thinks consumers are looking more for the one-stop shopping that benefits places like Walmart and Target, which have large grocery sections. "The grocery sector is the one that continues to drive development and investment interest across the USA. So don't look for that to be pulled back at all. Besides the grocery sector, I also see the F & B sector continuing to expand and grow. At the end of the day, the US consumer has said pretty strongly with their wallet they're going to make fewer trips to go shopping, but when they do, they want to get the most out of their shopping journey."
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This post was written by Nicholas Jacobino