As high inflation continues to plague Canadians, Okanagan retailers are feeling the impact of tightened spending – many businesses report slower sales heading into the critical holiday shopping season.
“We’re seeing the traffic go down, so we have less traffic now,” said Joe Kandola, owner of Hometown Furniture and Appliance. “(Customers) are also buying less expensive stuff … and also people are starting to finance a little bit more.”
According to Statistics Canada, inflation was 6.9 per cent in September. While that’s down from the 40-year high of 8.1 per cent in June, it’s still at a level that has many Canadians cutting back on expenditures.
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Kandola owns and operates three furniture stores in Kelowna, Penticton and Chilliwack. He’s now offering incentives to get shoppers in the door.
“We’re offering no tax, like no GST, no PST,” he told Global News. “We are absorbing the 12 per cent ourselves to attract more people, right, and you’ll see more and more sale items, stuff like that.”
Retailers believe the inflation rate is a contributing factor to the slower sales as of late.
“I think people are making a little bit more deliberate shopping choices,” said Laura-Ann Kavanagh, owner of The Wardrobe Boutique. “They’re just being a little bit tighter with their wallets, which makes a lot of sense right now.”
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The slower sales come as the retail industry enters what is usually its busiest time of year–the Christmas shopping season.
But according to Deloitte Canada and its 2022 holiday retail outlook, overall holiday spending is expected to fall by 17 per cent this season with an average of $1,520 being spent by a household.
“I’m a little bit nervous if people do hold on to their wallets a little bit tight,” Kavanagh said.
Being a small retailer, though, makes it easier to make adjustments to meet shoppers’ demands, she said.
“We’re able to to pivot, on our own, really quickly. So as we see people and what their purchases are, we can bring more of those items in,” she said. “So that makes me feel really confident about this Christmas season coming up.”
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Kelowna businessman Andre Blanleil is also feeling confident.
He owns Andre’s Electronic Experts and has 34 stores across B.C.
Blanleil said there is positive news on the retail front and it has to do with the supply chain returning to normal.
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He points in particular to products that were in such high demand over the course of the pandemic as people stopped travelling and going out, and instead upgraded their homes.
“As suppliers get caught up – whether it’s fridges or stoves or TVs, now – there’s getting to be where there’s almost too much inventory. The prices get much more aggressive because of the the supply chain’s been fixed and everybody’s sitting on inventory.”
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For that reason, Blanleil is expecting a busy Christmas season despite the slower sales as of late.
He believes shoppers will be lured by inventory overload deals.
“I think the next eight weeks … between now and Christmas is going to be incredibly aggressive as far as pricing,” he said.
A recent poll also suggested that shoppers would be holiday shopping a lot earlier this year as they search for the best deals they can find amidst inflation and mortgage interest hikes.
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At the Wardrobe bouttique in Kelowna–sales have slowed the past month.
SOT LAURA ANN in at 12:21 “I think people are making a little bit more deliberate shopping choices”
VO#2 Across town at the Hometown Furniture and Appliance store–a similar trend.
SOT JOE in at 15:11 “We’re seeing the traffic go down. So we have less traffic now, also. And the other thing is they’re also buying less expensive stuff too” PLUS in at 15:24 “And also people are starting to finance a little bit more”
VO#3 The locally owned and operated store now offering incentives to get shoppers in the door.
SOT in at 16:49 ” we’re offering no tax like no GST, no PST where we are absorbing the 12 percent ourselves to attract more people right And you’ll see that more and more sale items, stuff like that.”
VO#4 Retailers believe inflation is a contibuting factor According to Statistcs Canada–inflation was 6.9 per cent in September. While that’s down from the 40 year high of 8-1 per cent in June–it’s still at a level that is expected to have a significant impact on holiday spending as people trim their costs. According to Deloitte Canada and it’s 2022 holiday retail outlook, Overall holiday spending is expected to fall by 17% this season with an average around $1,500 being spent by a household.
STAND-UP “But there is some positive news for both consumers and retailers and it has to do with the supply chain returnin to normal”
SOT ANDRE in at 1:57 “As suppliers get caught up on whether it’s fridges or stoves or TVs. Now there’s getting to be where there’s almost too much inventory. The prices get much more aggressive because of the the supply chain. ”
VO#5 At Andres Electronic Experts, owner Andre Blanleil is expecting a busy Christmas season despite the slower sales as of late. He thinks shoppers will be lured by inventory overlaod deals.
SOT in at 2:47 “I think the next eight weeks of going between now and Christmas is going to be incredibly aggressive as far as pricing”
VO#6 The Wardrobe Boutique’s owner bracing for the Christmas season
SOT in at 12:46 “I’m a little bit nervous if people do hold on to their walls a little bit more tight”
VO#7 But ready to make quick changes to meet custmers demand to benefit themselves and the shoppers.
12:30 “Luckily we are a small retailer so as we see people what their buying purchases are, we can bring more of those items in. So that makes me feel really confident about this Christmas season coming up”