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CONSUMER SPENDING SHARPLY DECLINES
----Survey Confirms Recession Likely ----

New York, New York, October 19, 2000
For the first time in more than a decade, a consumer survey clearly reveals shoppers are cutting back on spending. In a new survey conducted by America's Research Group (ARG), 37.3% of 1000 consumers reported they are spending less on themselves and their families. 36.0% also said they are eating out less, while 32.2% are delaying their purchases. This high percentage strongly suggests that the US economy is on the brink of a recession.

America's Research Group (ARG) is a full-service consumer behavior survey research and strategic marketing firm which records consumer buying patterns for a number of retail clients and manufacturers.

C. Britt Beemer, Chairman of America's Research Group commented, "We've read a lot of stories about corporate America failing to meet third-quarter profits these past few weeks, but this is the first time consumers are telling us they are definitely cutting back. We keep being told the economy is strong, but the stock market is in decline, and the retail and e-tail sectors have been hit very hard. Many national retail chains have seen a precipitous drop in sales."

Why are consumers cutting back?

• Rising gas prices was the #1 reason cited by 42.9% of those polled
  
• 34.3% of respondents said that saving instead of spending has become their priority
• Shopper ennui has beset consumers as 34.3% said they need nothing new at the moment
• Consumer nervousness has extended to leisure time. 10.2% said they were not only taking shorter vacations, but were being more frugal by using Frequent Flyer points, hotel rewards or credit card points to make trips less costly, or simply driving
• The Presidential election has had some effect on retail spending. 6.1% said they were worried about the outcome of the race
• Loss of equity in stocks and other investments have 5.7% of investors polled cutting back on spending because their stocks have performed poorly this past year
• Loss of equity in stocks and other investments have 5.7% of investors polled cutting back on spending because their stocks have performed poorly this past year

"This survey clearly tells us that consumers are nervous," concludes Beemer. "They are hearing bad news every day, and they are now feeling it where it hurts the most-in their pockets. In my experience, when this happens, it indicates not only that we are headed for a slow holiday shopping season, but further declines in retail spending next year."

C. Britt Beemer is available for interviews.
For more information Contact America's Research Group.

America's Research Group, Ltd. (ARG), is a full service consumer behavior survey research company with more than 20 years experience. ARG has interviewed more than 4 million consumers. Utilizing both quantitative and qualitative research, the firm works with clients to develop practical and successful marketing strategies for pace-setting companies in the fields of home furnishings, appliance and electronics retailing, banking and finance, automobile dealers, department stores, specialty and mass merchants. Clients include Sealy Mattress, Barnes & Noble, AT&T Wireless, Eckerd Drugs, Broyhill Furniture, Thomasville Furniture, American Eagle Outfitters and many others. ARG claims a plus or minus 3.8% accuracy.

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