LI consumers are still spending cautiously

A federal report showing retail sales up 0.5 percent in July offered a bit of relief after a week of volatility in the stock market and negative financial news, but Long Island consumers remain cautious in their spending, local merchants said.

"On the street, do you feel a significant difference? No," said Francesca Carlow, co-owner of Trio Hardware in Plainview. "People are putting off [projects], not doing paint jobs or staining decks because everybody is anxious about spending extra income for something that isn't needed."

The U.S. Commerce Department on Friday said that national retail and food services sales for July were $390.4 billion, an 8.5 percent increase compared with the same month a year ago.

"You don't want to oversimplify, but I think after this week of amazing uncertainty it was kind of nice to see these numbers," said Barbara E. Kahn, director of the Jay H. Baker Retailing Center at the Wharton School of the University of Pennsylvania.

The reasons why sales rose are complicated and varied, making predictions about the upcoming retail seasons difficult, she said. Although part of the increase in sales can be attributed to retailers raising some prices because of cost increases and inflation, those increases generally were small, Kahn said.

Some gains came from retailers like Macy's, Inc. using innovative marketing strategies, she said. The period of the federal retail report also took place before the stock market's wild swings this week, she said.

Long Island consumers still have to spend, but they have been careful with their money, taking shorter vacations and staying close to home, said Julie Marchesella, first vice president of the Nassau Council of Chambers of Commerce and owner of Queen of Hearts Inc. in Merrick.

Retailers have had to become more creative, local merchants said. The Huntington Business Products Centre has had success using coupons to bring in business, said co-owner Amira Garbus. Still, shopping traffic has been down and people are cautious largely because they are still out of work and the housing market hasn't changed, she said.

At Trio Hardware, sales in May through July picked up after a very slow spring. Carlow partly attributes those gains to the store adopting propane tank exchanges to boost the average sales and attract new customers.

"In retail you always have to reinvent yourself and you always have to be on top of the game, particularly in competing with the big guys," Carlow said.