Thursday, May 1, 2008
Changing economy changes choices
By SUE WATSON
The rising cost of energy has predictable changes on shopping and spending patterns at the local level, according to some people available for interview last week.
Attorney Ki Jones said he is driving his smaller vehicle for better gas mileage lately.
He is also thinking of taking summer vacation closer to home this year, and he is more conscious about the thermostat setting at home and at his office, he said.
Jones said he is conserving energy and spending more time shopping for better values on groceries.
“I’m really starting to pay more attention to prices and ways to economize at home and work,” Jones said.
Levi McFadden, store manager at Piggly Wiggly in Holly Springs, said he is definitely seeing some differences in how customers shop since there are so many news stories about the economic changes on the horizon and fears of shortages of foods.
“People are stockpiling more rice because the price is expected to rise even further,” he said.
The shelf price for a bag of rice has gone up 25 cents since the scare of shortages has been bantered about, he said.
“Some things people see on the news set the pattern – for example, rice,” McFadden said. “We do not normally see this big a demand for rice.”
People are looking for ways to make their grocery dollar go further, he said. They are buying dry milk and less fresh milk.
“We have added three more lines of powdered milk because people are asking for it,” McFadden said. “And we are increasing our availability on those items.”
Another way people are attempting to make their grocery dollar go further is by purchasing private label items like Best Choice whereas their usual choice is the name brand. Since the price of name brand pops are going up, McFadden said more shoppers are resorting to private labels like Faygos and Best Choice cola brands. The pattern in drink buying changed about three weeks ago, he said.
“People are buying only the necessities and spending very carefully,” he said. “We don’t see as many shopping basket loads at the check-out counter.
“I think that news has an influence on their thought patterns.”
McFadden said shopping behaviors tend to change in a very predictable way when there are lots of stories in the national news about possible food shortages.
Ernie Hyde in the meat market at Piggly Wiggly said he has not noticed much change in the shopping patterns for meats.
“People are buying what they usually buy,” he said. “When money gets tight they usually pick out smaller packages of what they usually like.”
Hyde said escalating fuel costs affects everyone including himself.
“It affects us all because people have to cut back to have money for fuel to go to work,” he said.
Fred Carlisle with Big Star in Holly Springs agreed that shoppers are getting savvy as food prices go up with the cost of fuel.
“I have noticed people start to make the smarter buys or maybe go for the less expensive store brands,” he said. “Purchases of store brands climb as fuel prices rise.
“People only have so much money to spend. Maybe they don’t drive as much to eat out. It looks to me like people are eating at home more.”
Bankers also notice changes in customer behavior during times of economic downturn, said Charles King with Bank of Holly Springs.
At a banking seminar in early March this year, King said he learned that bankruptcies are through the ceiling.
“The Memphis area was leading the nation in bankruptcies,” he said.
Ways that bankers see belt tightening by their customers include driving a used car longer, particularly in the middle and low income bracket.
“The used auto market will be high mileage used vehicles instead of a newer ones while the new car market is in the upper economic group,” King said.
“Traditionally, during a time of economic downturn, people are more likely to get behind on payments because they can’t keep up. Working class people are usually making what they were a year ago.”
People do not realize how market downturns affect their lives, he said.
“One thing people don’t stop and consider is it doesn’t just hit ‘em at the gas pump. It hits them at all the retail markets.”
King said locally most banks are facing the same patterns.
“People are constantly looking for small cars and trucks and four-cylinder vehicles to get to work cheaper,” he said.
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