Retail Projections and Rumors Can Be Damaging (From USA Today)

A little different than the custom primary research we normally talk about in this space, but an interesting article in today's USA Today about the impact of the media's negative reports about retailers and the negative impact on their brands. Three excerpts from the article...

Retail implosion forecasts typically come from the same handful of retail consulting gadflies — at least one of whom says he makes money when retailers' stock prices fall — and the forecasts are often based on subjective criteria that do not jibe with widely accepted methods of assessing corporate health.

"People are really paying attention to these articles, and the effects are extremely damaging," says Tracy Mullin, CEO of the National Retail Federation, which represents most major retailers.

The complications of analyzing retailers' financials go beyond just a sound bite. "It is very dangerous to speculate who may or may not be surviving without being inside the circle of knowledge," says Janet Hoffman, global retail managing partner at the consulting firm Accenture. "There could be alternatives (the retailer) may be pursuing without going out of business."


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