Retailers ready for rush - East Valley Tribune: Business

Retailers ready for rush

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Posted: Sunday, November 23, 2003 1:56 am | Updated: 1:30 pm, Thu Oct 6, 2011.

Tricia and Doug Folger of Scottsdale, who have six kids and a bunch of nieces and nephews to buy gifts for, started their Christmas shopping early this year.

"There’s less stress, and the selection is great," Doug Folger said as he left the Disney store at Scottsdale Fashion Square with bulging shopping bags.

Rebecca Jones of Chandler said she’ll wait until the last minute to prowl the stores for presents.

"I don’t even realize it’s Christmas until the week before," she said.

Jones said she won’t be hitting the malls Friday. But throngs of others will pour into stores around the East Valley and across the country before sunup on the traditional start of the annual spending season, snatching up door-buster specials and shoring up retailers’ hopes for a happy holidays.

Most stores ring up 25 percent to 40 percent of their annual sales in November and December.

L ocal and national experts are predicting they will ring up good, but not great, sales increases this season compared with last year. Their forecasts range from a modest 4 percent to an optimistic 6 percent overall boost in business during November and December, based on an economy that appears to be on the mend and better-than-expected back-to-school sales.

"I am anticipating we’ll have a strong holiday season," said Sheila Hunter, general manager of Fiesta Mall. "I don’t believe it will be double digits, but a healthy increase over last year."

Hunter said the Mesa mall’s back-to-school sales were up significantly and that is usually an accurate bellwether. Another healthy sign — inventories are up.

"The stores are wellstocked — better than last year," Hunter said. That indicates retailers, who have been ordering conservatively for the last couple of years in hopes of avoiding massive last-minute discounts to get rid of overstock, believe they will sell more stuff.

The International Council of Shopping Centers, a retail trade organization, is betting on overall sales increases of about 4 percent based on its poll of 44 industry analysts from across the country.

"The bottom line — it’s going to be better than last year, although it’s prudent at this stage to bet on moderate growth rather than a repeat of 1999," the New York-based group reported, referring to the last banner retail year.

Positive indicators include increased disposable income because of tax cuts, tax credits and refinanced mortgages, and the new home-buying surge prompted by low mortgage rates, the group reported. That could fuel a home furnishings buying spree.

The so-called cocooning trend prompted by the terrorist attacks of Sept. 11, 2001, continues and a flurry of home buying always leads to a flurry of home furnishings sales. But it could mean re-focused spending rather than having a lot more money on the table.

Jennifer Litvinoff of Cave Creek, for example, has a new baby and a new house this Christmas. Litvinoff said the added responsibilities prompted her to tighten the purse strings.

"I’ll spend less this year," she said. "I’m being smarter with money. You want to put your money in the right place. This year my husband and I will buy furniture or something for the house instead of buying a lot of gifts for each other."

The shopping center council said negative factors such as high energy prices and stilllagging job growth may keep some shoppers cautious. Some local shoppers said they still feel stung by the economic downturn and are not so confident about the future.

Mona Irish of Mesa said she is almost finished Christmas shopping for her large family of eight children and seven grandchildren.

"I really have shopped the sales this year," she said. "Some (family members) have gone through a rough year, and we’ve helped, so it limits what we can do for Christmas."

Donna Goodrich of Mesa said she also is cutting her gift budget this year, buying more practical gifts and shopping online for bargains, with plans to make at least a quarter of her holiday purchases via computer. Goodrich said the recent recession and moving from a house to a mobile home have made her more careful about spending.

"I’ve realized how much stuff we don’t need," she said. "The older you get, the more you realize material things aren’t so important."

Valley-based retail developer Westcor, which owns Scottsdale Fashion Square, Chandler Fashion Center, Mesa’s Superstition Springs Center and Paradise Valley Mall in northeast Phoenix, surveyed local consumers and found that two out of three plan to spend about the same amount this year as they spent last holiday season, 17 percent plan to spend more, and 16 percent plan to spend less.

Westcor vice president Bill Whiteside said the mood among the surveyed shoppers and shops is upbeat, and Westcor will be watching closely to see how Friday’s sales shape up.

"The day after Thanksgiving is rarely the biggest shopping day," Whiteside said.

"But it sets the tone. You can get a flavor for the season. We are expecting a big day."

In fact the day after Thanksgiving, or Black Friday — so named because in the past it often was the first day of the year that retailers’ bottom lines moved from red ink to black, was the fourth biggest shopping day last year, said Patrice Duker, spokeswoman for the International Council of Shopping Centers. Last year, shoppers rang up 10 percent of their holiday purchases during the three-day after-Thanksgiving weekend, she said.

Duker said the biggest individual shopping days typically fall later in the month, when shoppers like Jones of Chandler finally jump on the bandwagon. But Duker said those waiting for the deep discounts of the past couple of years might be disappointed this year.

Popular categories this year are home electronics and clothing, Duker said. And as for where to buy them — everywhere.

After falling out of favor for a few years, mall department stores are back in vogue, although October sales were weak, she said.

"But core consumers are still looking for value, and the discounters will do very well," Duker said. Discounters include chains such as Wal-Mart, Target and new-to-town Kohl’s, as well as big specialty stores like Best Buy.

The Gilbert Target is already seeing big holiday sales in the home electronics, movies, DVDs and toy departments, said store manager Joe Cordovana.

And in gift certificates — the year’s top trend for the clueless gift-giver.

"It looks like it will be a great Christmas season," Cordovana said.

At the other end of the spectrum, both Whiteside and Duker said shoppers are expected to opt for some pricier purchases this year.

"Both Nordstrom and Neiman Marcus have had successful months," Duker said. "It appears people are going back to luxury goods."

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