He believes harsh conditions should put fire in the bellies of store chiefs and force them out of the complacency that may have crept into their businesses. Kalms (pictured), speaking in response to exclusive Ernst & Young research for Retail Week that reveals how consumers' discretionary spend is being squeezed, said: 'Unfortunately there's a whole generation of young retailers who wouldn't know how to spell recession, never mind how to react.
'A downturn is one of the wonderful experiences of retailing. You need to relearn your trade and all the things like service and value that you tend to let drift in good times.'
According to Ernst & Young, the fixed outgoings of a typical household have soared by 16 per cent in the past three years and swallow up 55 per cent of net income. The spending power of homeowners is being squeezed by the escalating cost of repaying their mortgages. The average monthly payment is nearly£60 more than three years ago.
Consumers are also being stung by the rising cost of personal debt, with credit card and loan repayments up 17 per cent a month on 2002/2003 levels. Ernst & Young head of retail Tim Sleep said rising living costs are frightening consumers. 'Fears about house prices, record levels of household debt and the pensions crisis arguably lie at the heart of the consumer downturn,' he said.
Former B&Q chief executive Martin Toogood, who is bringing Danish furniture chain Ilva to the UK, also said that a consumer slowdown can still spell opportunity. 'Some of the best companies are started in the most difficult circumstances,' said Toogood. 'Even in times of recession it doesn't mean people don't buy. It is about taking business from other people.'