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Businesses are counting on a last-minute rush of shoppers to save their season. Analysts' forecasts are divided.
By MARK ALBRIGHT, Times Staff Writer
© St. Petersburg Times, published December 19, 2001
Holiday shoppers continued to be frugal through last weekend, leaving retailers' hopes of salvaging the season reliant on a big finish.
Analysts are split on whether it's too late for retailers to pull what has been a dismal performance out of the flames.
"It's possible, but unlikely," said Frank Badillo, senior economist with Retail Forward, a Columbus, Ohio, consulting company. "Retailers are cutting prices to the bone, so it's going to be tough for them to finish the season on the positive side."
Overall retail sales estimates won't be completed for weeks, but several measures of sales gains for the week that ended Sunday point to an off year.
Compared with the same week last year, sales in stores open more than a year rose a modest 1.8 percent nationally and 2.6 percent in Florida, according to TeleCheck Services. Sales were down 0.6 percent in malls, excluding department stores, according to the International Council of Shopping Centers. The Bank of Tokyo-Mitsubishi, which tracks 84 chains, said sales through Saturday were running 3 percent ahead of last year.
But many retailers generate 25 to 35 percent of their business for the entire 32-day season in the final week. Yet a survey compiled by America's Research Group suggests more than half of shoppers already holstered their credit cards and called it quits. So many chains are cutting prices even more to woo last-minute shoppers and avoid being stuck with unsold Christmas goods.
"We expect to see a significant surge in spending as we approach the end of the holiday season, with this Saturday as the biggest shopping day of the year," said Ira Silver, a retail sales analyst for TeleCheck Services.
Holiday sales can make or break the year for retailers, who get up to a third of their annual sales and half their annual profits then. With consumer spending accounting for two-thirds of the gross domestic product, holiday spending this year is a gauge of how long the economy will languish in recession.
- Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.