Stores scramble to increase sales
By Anne D'Innocenzio
By Anne D'Innocenzio
NEW YORK — The nation's retailers are pulling out all the stops to hit their holiday sales goals by expanding hours in the final days before Christmas and ratcheting up discounts.
Some mall-based stores like L.L. Bean are pulling all-nighters. Federated Department Stores Inc.'s Macy's store in Elmhurst, N.Y., will be open 83 hours straight through Christmas Eve; neighbors Express and AX Armani also will pull all-nighters.
After a disappointing start to the month, stores are counting on procrastinators like Victor Mack and Sally Neal to make this a strong season.
"I come from a line of procrastination, mainly the men in my family," said Mack from Concord, N.C., who was buying an iPod Nano for his wife at the Apple store in Charlotte, N.C., this week.
Neal, who was shopping in downtown Indianapolis, was about half done with her holiday shopping. "Since I work, it's just a matter of when I have time," she said. "So I don't get to shop for deals."
Clearly, winners and losers already have emerged. Deep discounting of flat-panel TVs led to a buying surge, as well as a profit blow to Best Buy Co. and Circuit City Stores Inc. Luxury stores' business has been sparkling as well-heeled shoppers are showing no restraint for $5,000 handbags.
Other mall-based stores have stuck to their already generous promotional calendar, keeping profits intact so far and refusing to buckle under pressures from shoppers to hold out for the best bargain. Stores were cautious when planning their holiday inventories this summer when gas prices were higher, fearing that shoppers would pull back. But even with declining gasoline prices and a steady job market, many shoppers have been selectively buying.
"I'd like to spend more, but I can only spend about three, four, five hundred dollars," said Ron LaJoy of Albany.
Many apparel chains, struggling with stiffer competition from department stores, could accelerate discounts this weekend beyond what they planned to lure buyers. With Christmas falling on Monday, tomorrow is expected to be the busiest shopping day; that poses a risk to profits, since more sales will be done at discounted prices, said Dan Hess, founder and CEO of Merchant Forecast, a New York-based research firm.
"Although the profit picture for consumer electronics is grimmer, all of retailing is going to suffer to a certain degree," said Hess. Based on a current check of about 40 mall-based stores, discounting is down from last year at this time, but he expects price-cutting will exceed last year's levels by this weekend. Department stores' profits should do well, while mall-based apparel stores should be mixed, he added.
In the season's final days, merchants are catering even more than ever to procrastinators who didn't have time or waited for the best deals. Mild weather also didn't motivate consumers to snap up winter items like snow boots.
According to a poll of 1,000 consumers conducted by Opinion Research Corp. for the International Council of Shopping Centers, four out of five households said they are shopping later this year than in 2005.
Meanwhile, in cyberspace, Best Buy is dangling a new offer: If shoppers order merchandise by 3 p.m. Sunday on Bestbuy-.com they can pick up their order in-store before the store closes at 5 p.m., according to Lauren Naru, a company spokeswoman.
Improved business in recent days has been encouraging. And some consumers were doing some buying for themselves.
"The Victoria's Secret, the Nordstrom nylons, the Macy's stuff and the $300 plus worth of clothing I spend up in Brass Plum — me," said Renee Gonzales of Tukwila, Wash. "You've got to look out for number one, you know."
The Chicago-based research company ShopperTrak RCT Corp. reported that thus far in the holiday shopping season, average weekly sales for December compared with 2005 are up 4.3 percent, approaching its projections for 5 percent sales growth.
"The question isn't whether the holiday season is going to be strong but could it have been stronger," said Scott Krugman, a spokesman at National Retail Federation, which is sticking to its projection of 5 percent growth in total holiday sales over a year ago.