French Consumers Tighten Belts With AM-British-Interest Rates, Bjt
PARIS (AP) _ Unsettled by a sluggish economy and high unemployment, French consumers have tightened their belts - spending less in supermarkets, department stores and trendy boutiques.
″The French face lots of uncertainty, and have adopted crisis behavior,″ said Dominique Georgeon, a marketing analyst at Les Printemps department store. ″People are reluctant to spend money.″
Unemployment is at 10 percent in France, and economic growth slowed sharply last year - just 1.25 percent, compared to 2.25 percent in 1990. Growth for this year is projected at 2 percent.
Consumer goods - including home furnishings, appliances and clothing - have been hit hard by consumer wariness.
Even the food sector, once a bastion of uninterrupted growth, shows signs of decline.
″The average customer is putting less in his basket than he did last year,″ said Thierry Pequernel, manager of a Franprix supermarket in Paris.
″People are eating less high-priced food and going back to the basics. However, volume of our own brand items, like coffee, dairy products and canned goods, is way up,″ he said. ″This is new.″
A consumer analyst, Philippe Moati, said the French are looking for ways to extend the life of things they already own. They’re also putting off expensive purchases and choosing lower-price merchandise when they do buy.
″This trend is particularly visible in the hi-fi sector,″ he said.
The luxury industry also is feeling the pinch. A saleswoman at the Chanel watch boutique said business slumped during the Gulf War and has never recovered.
Car manufacturers complain about a new trend away from powerful luxury models toward smaller, less expensive models.
″Tastes have changed,″ said Daniel Leconte, head of marketing at Renault. ″However, we do know that the customer who wants the expensive car, and who has financial difficulties, will postpone his purchase rather than choose a cheaper model.″
The fashion-conscious French are even economizing on clothes.
According to the Textile Group of Economic Observation, the number of purchases made in the first half of 1992 was virtually unchanged from 1991.
″The stores are bulging with merchandise, but budgets are tight,″ said Gerard Roudine of the French Ready-To-Wear Federation. ″There’s a trend toward buying things for investment, to last.″
Some manufacturers have sought to lure customers by cutting prices. Rene Derhy, maker of women’s and children’s clothing, has lowered the prices of its 1993 summer collection by 30 percent. Liberto, which caters to teenagers and young adults, has dropped prices 10 percent.
Les Printemps’ own brand of menswear, Brummel, is selling for 20 to 30 percent less than last year.
At a time when boutiques usually showcase the newest fall and winter fashions, many are still offering sale prices on leftover spring and summer collections.