Many businesses seem to think so. Companies didn’t add to inventories in the first quarter, an indication that they expect sales to slow in the months ahead and don’t want to be stuck with products they can’t sell.
“Consumption is still strong, and yet businesses seem to think that they don’t need to restock inventories because presumably they think consumption will weaken,” said Megan Greene, chief economist for the Kroll Institute. “So who’s right?”
At Nexgrill, a California-based seller of grills and other outdoor cooking equipment, sales of lower-end models, those under $500, have been strong so far this year, said Ramsay Hawfield, a vice president at the company. But sales of higher-priced products have begun to slow in recent months, which Mr. Hawfield takes to mean that some consumers are watching their budgets more closely.
“They’re not feeling as rich as they were a year or two ago, and now they’re feeling a little pinched and a little nervous,” he said. “The person that was buying that $500 or $600 grill is saying, ‘Maybe I’ll go with that $300 or $400 version.’”
Nexgrill isn’t laying off any workers, Mr. Hawfield said, and it is still investing in new products. But it is doing so carefully, avoiding features that consumers might not deem worth the extra cost. Retailers, he added, are pushing Nexgrill and other brands to keep prices down — something that was much less true a year ago, when consumers hardly seemed to look at price tags.