As Consumer Confidence Rises, So Does Spending on Big Ticket Items

Consumer confidence is at a six-year high, so you'd think spending at discount retailers would be showing a similar rise. Not so. Why?

People are spending more on big-ticket items: homes and cars. Items that, in some sense, represent "stability" according to a recent Reuters article. Low interest rates are also contributing to the increased auto and home sales. And that could very well affect holiday spending in 2013. Industry insiders expect appliance sales to increaes during the holiday season, as well as sales of other home goods and cars. 

So-called discretionary spending has also been affected by high gas prices and the payroll tax. With interest rates low, many people feel now is the time to make the big purchase - before rates rise, and they'll forego other purchases to make that happen.

While that may be good news for stores like Home Depot, what does it mean for retailers like Macy's or Target or Toys R' Us?

Now is the time to review your POS data and look for items that are associated with home and auto purchases. What SKUs do you have on board that can merge with the trend for increased home and auto sales? Those items might make great holiday gifts for new home and auto owners.