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Retailers Usher in Holidays With Deals

November 29, 2002

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Bargain hunters woke before dawn to head to the nation’s stores and malls Friday, the official opening of the holiday season, hoping to take advantage of early bird specials on hot toys and big-ticket items like TV sets.

Retailers are hoping to keep the crowds coming in the next few weeks to avoid what is expected to be a lackluster holiday season, given the sluggish economy.

In a scene that played out across the country, about 500 people lined up at a Wal-Mart store in Abington, Mass. before the discounter opened its doors at 5 a.m.

Among the early risers was Donna Gramazio of Brockton, Mass., who came out to buy children’s bikes and a battery-operated toy Jeep, which was on sale for $197.

``I wanted to get my shopping done all in one day,″ she said.

Sheila Sherlock of Whitman, Mass., was buying lots of toys, including a Playdough set and a doll. She was also buying electronic devices: two Gameboy advance handheld games that were $44, marked down from $69.99. She scored a Symphonic VCR/DVD player for $98 and a computer printer for $28.

``It’s exciting,″ Sherlock said. ``People just race for the door.″

At a Best Buy Co. store in Lincoln, Neb., 600 shoppers lined up before dawn.

``I usually sleep in, but they had some deals I couldn’t pass up,″ said Robert Willman, a 19-year-old University of Nebraska student. He was in line for DVDs, CDS and a computer hard drive.

One of the first in line at a Wal-Mart in Manville, N.J., was Jackie Hawkins, 45, of Somerville, N.J., who showed up a little after 4 a.m. for the 6 a.m. store opening. She was in search of a Nintendo Advanced Game Boy. Meanwhile, Joan Muniz, 48, of North Brunswick, N.J., was excited about the 27-inch Symphonic television she got for $148.98.

In Bismarck, N.D., Wendy Anderson, 37, came out of K-B Toys with two large bags stuffed with items, including a Hasbro Fur Real Friend.

``I pretty much ran through the store. Eleven minutes to shop, save $200,″ she said as she gleefully left the store.

At K-B Toys at the King of Prussia Mall in King of Prussia, Pa., there were about 75 people in line before the 5 a.m. opening.

Among them was Cherie Schroeder, 36, of Audubon, Pa., who was in search of a Fisher-Price car garage and a Crayola ``trace and draw.″ She found them.

``They’re really hard to find. I’ve looked at three other stores,″ she said of the Crayola kits.

She was also on the lookout for a skateboard ramp on sale for $17, from $30.

Despite the crowds that showed up at the stores for the specials, analysts believe consumers will be tight-fisted this year.

``Sales will be intense. Consumers will turn out in full force to the mall, but there is a general feeling that consumers are going to be reticent,″ said Kurt Barnard, president of Barnard’s Retail Trend Report, based in Upper Montclair, N.J. ``They will look at the price tag before they look at the product.″

The lack of must-haves, combined with a season six days shorter than a year ago, exacerbates what is expected to be an already difficult holiday, given the sluggish economy. A shorter selling season puts more pressure on merchants to react to best-selling items.

The nation’s largest merchants have protected themselves with lean inventories so they won’t have to dispose of mounds of leftovers on Dec. 26. But stores might also have the opposite problem _ finding themselves with not enough merchandise if consumers decide to splurge.

After all, shoppers pleasantly surprised retailers last holiday season with last-minute buying binges that resulted in better-than-anticipated results.

So far, retailers haven’t seen any signs making them feel more optimistic.

``Clearly, there is still considerable amount of uncertainty _ the prospect of war in Iraq and the economy. The consumer is still not on solid ground,″ said Michael P. Niemira, vice president of Bank of Tokyo-Mitsubishi Ltd., who is expecting sales at stores open at least a year to be up 3 percent for the combined November and December period. That’s compared with a 2.2 percent increase last year.

According to the Gallup Organization, which surveyed 3,000 consumers, Americans are projected to spend $769 on gifts this holiday _ about $51 less than last year, which in turn was lower than 2000 and 1999. About 25 percent of Americans said they will spend less on Christmas gifts this year than they did last year. A slightly lower number _ 19 percent _ said they’ll spend more, the Gallup survey said.

Financial worries were evident at the nation’s malls.

``With the economy, holiday shopping becomes more of a struggle each year,″ said Georgette Rooney, 49, of Somerville, N.J., who was shopping at a local Wal-Mart store.

The Washington-based National Retail Federation predicts total holiday retail sales, which exclude restaurant and auto sales, will increase by 4 percent to roughly $209.25 billion. That would make it the weakest increase since 1997.

Last holiday, retailers had $201.2 billion in sales, up 5.6 percent from 2000.

While the Thanksgiving weekend starts the shopping spree, it no longer is the busiest period of the season. Last year, the weekend accounted for 8.4 percent of holiday sales. The busiest period was the last week before Christmas, which accounted for 34 percent of holiday sales, according to the International Council of Shopping Centers.

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