SELDOM have the priorities of so many retailers been turned on their heads so quickly.

Since the last quarter of 2007 consumer confidence has fallen to an all-time low, and by early next year it is certain we will be in our first recession for two decades.

The public are retrenching, cutting their outgoings and making different choices when they do spend.

Business is certainly tougher but the speed with which we have reached this trough is the greatest shock.

In the recession of the early 1980s I was a graduate management trainee with John Lewis, while in the tough times of the early 1990s I was managing director of a John Lewis department store. My clear recollection of those recessions is that they were shallow, single-digit downturns, not the double-figure decline that many non-food retail businesses are now reporting.

Of course, there has been a need for a correction to our overinflated housing market and high levels of consumer indebtedness. But the fear of fear has played a part in creating today’s conditions on the high street.

Consumers have done what is prudent for themselves out of fear for the future, but by cutting their spending they have contributed to further slowing of the economy.

As prudence has become the new black, one wonders how long it will take for the fashion for consumerism to once again become the bedrock of the western world’s capitalist model. A revival in the sales of ladies’ shoes is normally the first sign.

Nonetheless, you can’t blame people for being scared. We’ve had a run on a bank, seesawing stock markets, the reported near-collapse of the western banking system, the virtual destruction of the Icelandic economy and job losses as some businesses seek to cut discretionary spending and preserve cash reserves.

Any one of those would make the most dedicated consumer think twice but, combined with pessimistic commentary and “the end is nigh” headlines, you’ve got a surefire way of stopping shoppers dead in their tracks.

In my own sector of business, the perceived wisdom would have you believe that customers are eschewing quality food retailers for European discounters. This isn’t an accurate picture. The main reason we have seen our sales come off their peak in the second quarter is that customers have decided to trade down - and they are also buying far more products on promotion.

It is reassuring to know that our customers’ commitment to high standards of animal welfare, solid ethical and environmental policies and long-term supplier relationships has not been easily or quickly jettisoned. However, it’s not only consumers who are making different choices.

Suppliers, too, are in danger of being squeezed by aggressive pricing demands. The best guide to food quality is still the price on the label. It is an unassailable fact that good food can never be dirt cheap, especially if you’re paying a sustainable price to your farmers and growers.

Nonetheless, at Waitrose we know that we cannot be complacent in the face of prevailing economic conditions and that’s why we’ve cut prices on everyday lines.

We’ve achieved this without compromising the quality of our products or putting at risk long-term relationships with our suppliers. We have also continued to invest in customer service and product quality.

When the green shoots of recovery begin to show, it is our business goal to emerge from this downturn with an even more compelling customer proposition.

As the eskimos say, the best time to go fishing is when the weather is at its worst.

Times Recommends

• Tories’ green bank to revolutionise power policy
• UK car industry receives £2.6bn injection
• Pru chief turns down seat on board of bank