RICHMOND, VA (WWBT) – There is perhaps no sector that has been hit harder by the economy than retail. Shop owners are struggling to get by as the economy struggles to get back on track. Joining us to discuss these challenges is George Peyton. He is the Vice President of the Retail Merchants Association.
Ryan Nobles: George, before we talk about the retail climate, I want to ask you about the news we learned about yesterday about the state's unemployment fund. We learn the coffers are running low to pay these unemployment benefits. That is going to result in Virginia taking a pretty sizeable loan from the federal government. Is this something that down the road could impact small business owners and retail owners? Could this money eventually come from them to be forced to pay back?
George Peyton: Ryan, you're exactly right. Once a small retailer or any retailer has to start and absorbing additional taxes on top of a down economy, it suppresses the retail industry. It affects a person -- if I was going to repaint my delivery trucks this year, I may decide not to do that. I'll put it off another year, so therefore the guy who's going to paint the trucks doesn't get the money that he was expecting, so they're trying to cut back on expenses, lower their costs of doing business, but once this new tax is added on and kicks in, it's going to suppress retail.
Ryan Nobles: And it could take time for the full impact to be understood, right? Because this loan doesn't are to be paid back for several years. Do retailers have any idea of how difficult the impact would be?
George Peyton: No. It will be ongoing. If the economy continues to turn in a positive direction, consumer confidence turns in a positive direction, you get more sales, retailing will go start to increase their hiring, all of this will be a catalyst to move it forward in a positive direction but we have to look forward to a very good selling season for back-to-school and for the holidays.
Ryan Nobles: That leads us into our next topic of conversation. This is perhaps the most important time for year with retailers, beginning with back-to-school and leading into the Christmas shopping season. Are you more optimistic now than you were at this time last year?
George Peyton: Yes, and I think a lot of the consumers are. For those consumers who are still unemployed, they don't see it, but there are people out there -- this past weekend was the back-to-school sales tax holiday. I spent Friday and Saturday, Sunday out looking at retailers and what was going on. People were shopping and buying. I think they're being very cost conscious in saying I'm looking for coupons and ways to save, so they're looking for good sales, but the back-to-school as a barometer of how the things will kick off for the fall season and it's critical that we get a good holiday season this year.
Ryan Nobles: Very quickly before we go, does this mean consumers can expect more big deals leading into both of these two important shopping seasons?
George Peyton: I think retailing is as competitive today as I've ever seen it and you will find a lot of discounting, but I think at the same time, the smart consumer is going to look for the good product at the beginning of the season and they will find a 10% off or 15% off sale and they better take it because inventories are also a lot less than they used to be. People are not buying in the depth that they were.
Ryan Nobles: Time to be a savvy shopper. Thank you, George, we appreciate it.
George Peyton: Thank you.
See the video at right for the full interview.