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The Honolulu Advertiser

Posted on: Saturday, December 25, 2004

Christmas Eve bargains aplenty

By Anne D'Innocenzio
Associated Press

Shoppers — some holding out for the best bargains, others delayed by winter storms in the Midwest — hit the nation's malls and stores, looking for last-minute gifts and snapping up gift cards on the day before Christmas.

Fred Jones, one of scores of last-minute shoppers, found a great gift in a big package yesterday at Fry's Electronics in Burbank, Calif.

Nick Ut • Associated Press

Retailers, struggling with disappointing holiday sales, were heartened by an uptick in sales at malls this week, and traffic appeared solid yesterday. But the industry is still resigned to the fact that the 2004 holiday shopping season won't be stellar. The question is whether the last-minute boost will be enough to help stores meet their modest sales goals.

The exceptions have been online shopping, with sales at the high end of projections, and luxury stores, which have continued with robust sales from their well-heeled customers.

That means merchants are once again finding themselves in the same position as they were last year, relying on those last-minute shoppers, who seem to be delaying their buying even later than a year ago. Last year, a late spending surge gave struggling retailers a better-than-expected holiday season. In 2002, however, the last-minute boost before and after Christmas was not sufficient to overcome December's earlier weakness.

With many stores struggling with higher inventories at this late stage of the holiday season compared with last year, plenty of customers looking for bargains were pleased with the options.

Michael P. Niemira, chief economist at International Council of Shopping Centers is sticking with his latest holiday forecasts, having lowered his sales growth forecasts to 2.5 percent to 3 percent earlier in the month. He had originally projected sales for the November and December period would be up anywhere from 3 percent to 4 percent. The National Retail Federation continues to forecast a 4.5 percent gain in total holiday sales, which exclude restaurant and auto sales.

Meanwhile, online sales have been robust. Internet research firm comScore Networks Inc. said online sales in November and December are tracking at the high end of its forecast of a 23 percent to 26 percent gain from the year-earlier period.

The final days before Christmas and post-holiday business, boosted in part by gift-card sales, have become increasingly important for retailers. Gift-card sales are not recorded on a retailer's balance sheet until the cards are redeemed.