Bleak Holiday Earnings Forecast For Canadian Retail Sector

November 11, 2008 1:15 p.m. EST

Toronto, Ontario (AHN) - It will likely be a bleak Yuletide season for Canadian retailers based on a survey of consumer behavior conducted by consulting firm Deloitte & Touche. The study said up to 40 percent of Canadian consumers intend to curb their year-end holiday spending.

The figure is significantly higher than the 25 percent who gave a similar response a year ago.

The poll was done from Sept. 29 to Oct. 3. It discovered that while many Canadians will still do their traditional Christmas shopping, many would be on the lookout for lare discounts and home essentials.

Brent Houlden, a retail partner at Deloitte & Touche, explained to the Toronto Star, "Consumers always spend more than they intend during the holiday season and with Canadians currently enjoying lower gas prices they'll have a little more cash in their wallets. But, Canadian retailers will have to work hard to earn that holiday spend, as consumers will be scanning for value and hunting for bargains."

The survey also found out that there will be lesser Canadians who plan to cross the border to shop and also fewer techies will do their Yuletide purchases online.

The findings coincide with a decline in corporate confidence. According to the Conference Board of Canada, company confidence declined again during the third quarter. From July to September, business confidence went down by 13.5 points to 78 points. Counting the continuous dip of the index since the second quarter of 2007, the decrease in business confidence has totaled 29 points.