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High Gas Prices Fueling Retail Slump

The high price of gasoline in Southern California is hitting retailers on two fronts. Stores are paying more to bring in their merchandise and their customers have less money to spend. All that pressure is adding up to tough times for the retail industry. Reporter David Nogueras has more.

Consumers are cutting back on their spending as more of their paychecks go toward the cost of commuting. 

George Whalin is the president of Retail Management Consultants in Carlsbad. He says that's taking its toll on retailers. Whalin says in such a tough economic environment, stores can only pass on so much of those costs to consumers.

Whalin: Because of the nature of particularly the food business but all of retailing today -- it's a fiercely competitive industry. So it's very difficult to raise prices. But the nature of the business is they're going to absorb some of that.

Whalin says businesses that sell clothes are having a tough time because that's one of the first places people cut back during hard times.

On the other hand, Whalin says stores like Walmart and Costco are doing better because people are looking for bargains.

For KPBS, I'm David Nogueras.

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