Uncertainty discounts IMRA
May 28, 2001,
There is a well-worn adage in the mass market that when the economy gets lousy for everybody else, it gets even better for discounters. The fabric of such an argument may be beginning to fray. Or at least that was the impression at last week's annual conference of the International Mass Retail Association, where the malaise was as palpable as the soupy heat hanging over the Wyndham Anatole convention hotel in Dallas.
Vendor attendance was down as well, in part owing to the elimination of the trade show portion of the convention, and in part, one must assume due to budgetary considerations.
Which isn't to say that the atmosphere wasn't genial. There was back-slapping, hand-shaking and anecdote-swapping a-plenty in the seminars where retailer and vendor attendees came together. Nonetheless, retailers seemed to be making themselves unusually scarce at the conference's evening social events — the hefty tabs of which are footed by vendors and which traditionally have provided a setting where little guys can glad-hand retail execs on the high end of the food chain.
Retail companies that previously made a point of turning out with a full phalanx of executives who were dutifully kept visible for the run of the show, operated with a lower profile this year. Many by-passed the social events altogether, slipping off-site for private staff dinners, or sending a couple of execs through an event for 20 minutes before blasting out the door.
Make no mistake, IMRA has mounted conventions during difficult selling environments in the past. But even in years when half of its members seemed to be in Chapter 11 and the other half teetering on the brink of it, the mood was not as fragile as it was last week in Dallas. This year's gathering was undergirded by the feeling of deep uncertainly, suggesting that this down cycle is not likely to be any kinder to discounters than it has been to other retailers.
If nothing else, it pointed up the unpleasant after-effects of the consolidation that swept over the mass market retailer and vendor communities during the '90s. Not so long ago, if you weren't doing business with one of the big three discounters, you could still turn to three $2 billion chains (Caldor, Ames and Venture), three just-under $2 billion chains (Bradlees, Hills and ShopKo) and some $400 million to $700 million chains to take up the slack (Rose's, Pamida, Fedco, Jamesway and Clover).
It's a much smaller party today. One guy catches cold, everybody starts sneezing. Even on the sizzling flatlands surrounding Dallas.