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Crunch time watchword: Caution

Waiting: Shoppers, holding out for price drops, are being more practical in gift buying.

By MARK ALBRIGHT, Times Staff Writer
Published December 15, 2007

Customers browse the Macy's department store Friday in the WestShore Plaza in Tampa. Retailers report that shoppers are spending less than in recent years as they try to stretch their dollars further in a troubled Florida economy.
	[Daniel Wallace | Times]

ADVERTISEMENT [Daniel Wallace | Times] Employees Dottie Stephens, left, and Cristina Gonzales prepare Friday for a holiday sale at the BCBG Max Azria store at WestShore Plaza in Tampa.

TAMPA - Cherie Cacciatore has shopped the malls weekly since Halloween, but has yet to buy the first holiday gift.

"I know exactly what I'm getting everybody," said the 38-year-old Tampa mother of three, who plans to spend no more than last year. "I'm just waiting for prices to drop...like to 50 percent off."

Bargain hunting is the operative tactic this holiday season as crunch time arrives in the annual waiting game to see who blinks first: customers intent on getting a deal before the good stuff is gone or retailers cutting prices to avoid being stuck with unsold merchandise on Christmas Eve.

Tampa Bay retailers and mall managers say weekend traffic has been strong since Thanksgiving. But weekdays have been Deadsville and spending weak. And - the new wrinkle this time - consumers feel squeezed and are trying harder to be more practical.

"Every holiday since the beginning of time has been a nail-biter," said Steve Knopik, chief executive of Beall's Inc., a Bradenton retailer with more than 500 stores. "But this year has been softer than usual and our Florida stores are more challenged than other states."

"Our business has been slower, but it's starting to pick up," said Casey McEngenter, a Sports Fan-Attic store manager in WestShore Plaza.

Indeed, the most recent indexes measuring sales through last weekend show shoppers went into a deep lull after a big discount-driven start the day after Thanksgiving. The International Council of Shopping Centers, which measures sales reported by 60 big chains, said its index of sales in stores open more than a year was up a lackluster 2.3 percent over the same week a year ago. Johnson Redbook, which monitors apparel spending in 9,000 stores, reported a 2.3 percent increase in its same- store sales index. Nonetheless, the National Retail Federation is sticking with its forecast of a modest 4 percent overall gain in general merchandise sales during November and December.

"Consumers continue to be slow finishing their holiday shopping, which implies a big surge is yet to come," said Michael Niemira, chief economist for the trade group of shopping center landlords.

The pace is supposed to pick up dramatically starting today as the season shifts into a nine-day finish spread over two weekends.

"We'll see a tsunami of shopping," said Britt Beemer, president of America's Research Group. His surveys found 49 percent of shoppers were in stores the season's third weekend. That's 10 percentage points behind last year. Four in 10 shoppers say they are waiting for half-price deals before opening wallets.

Whether prices drop that deeply is another matter. Expecting weak demand when the first signs of a slowing economy and credit crunch surfaced in August, retailers trimmed inventory so they are less desperate. So far, they have been disciplined about cutting prices except to stimulate demand with short planned-in-advance sales that last only a day or a few hours.

"I haven't seen any panic sales yet,' said Jay Botsch, manager of WestShore Plaza. "But we could use a cold spell to get people in season attitude."

Meanwhile, consumer research firms pinpoint some new spending trends showing how consumers hope to pare expenses.

Middle-income shoppers who traded up to stores like Nordstrom are trading down to Macy's, according to the Luxury Institute. People who last year sought gifts in the $30 to $40 price range fell to $25 to $35.

It's beyond the subprime loan crisis and deteriorating housing prices. Slow times in the construction and real estate sales industries in Florida have cut into jobs and pared wages of many..

"Even if their financial situation hasn't changed, they're paying more for gas," said Phil Rist, vice president of BIG Research, which surveys 7,000 shoppers monthly for many retail chains. "They see all those unsold homes in their neighborhood. They know people who are affected. Things they don't control creates uncertainty, so they adjust what they do control: discretionary spending."

Busy days ahead

Monday: Forecast to be biggest day of year for online retail sales.
Tuesday: Most online retailers say they must begin processing free shipping so packages arrive before Christmas.
Friday: The last date most online retailers can accept even a paid express shipping order for delivery before Christmas.
Saturday: Expected to be biggest day of year for all retail sales.
Dec. 24: Most stores will close at 6 p.m.

Sources: Shopzilla, Shop.org, Chase Paymentech, dealnews.com, National Retail Federation

Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.

[Last modified December 14, 2007, 23:05:00]