US retailers pessimistic on holiday season

Bloomberg

While U.S. consumers came out in greater numbers in the days after the U.S. Thanksgiving holiday than the National Retail Federation trade group forecast, discounts of up to 70 percent may have been what drew them to stores, the Washington-based NRF said.

The National Retail Federation said 172 million shoppers went to stores and Web sites, a 17 percent increase from a year ago and more than a forecast of 128 million. They spent an average of $372.57, up 7.2 percent from last year, according to an e-mailed survey conducted for the NRF by BIGresearch, a polling firm.

Reluctance to spend
The early turnout may not be enough to overcome consumers’ reluctance to spend as they cope with climbing unemployment and housing costs and shrinking values in their stock holdings. The NRF said its forecast remains that holiday sales will rise 2.2 percent to $470.4 billion, the slowest growth in six years.

"Black Friday will not change the fact that it is going to be a challenging holiday season," NRF spokeswoman Kathy Grannis said in a telephone interview. In 2007, while 4.8 percent more customers shopped during the period, they spent on average 3.5 percent less. Total holiday sales rose 3 percent last year, the smallest gain since 2002.

This year’s pattern may be similar to 2002, when total holiday sales rose 1.3 percent, Grannis said. Consumer spending accounts for more than two-thirds of the U.S. economy.

Shoppers have spent 4 percent less online this holiday season so far, although purchases ticked up from last year on Thanksgiving and Black Friday, Reston, Virginia-based research firm Comscore said yesterday.