Categorized | Money

Black Friday Weekend Spending Drop Pressures U.S. Stores

Posted on 04 December 2013 by admin

Purchases at stores and websites fell 2.9 percent to $57.4 billion during the four days beginning with the Nov. 28 Thanksgiving holiday, according to a survey commissioned by the National Retail Federation. While 141 million people shopped, about 2 million more than last year, the average consumer’s spending dropped 3.9 percent to $407.02, the survey showed.

While the NRF reiterated its forecast this week that total sales in November and December would increase 3.9 percent, the trade group has said it would revise the forecast if necessary later this month.

“Retailers didn’t get what they wanted from Black Friday and they will need to make it up in the next three weeks,” Poonam Goyal, an analyst for Bloomberg Industries, said in an interview. “There will be some panic sales.”

“Consumers are generally not in a great mood, feeling very uneasy about the economy and their jobs, and are looking for value this year,” Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut, wrote today in a note to clients. “They have their list and will check it twice, but they are not going to the mall and grabbing a bunch of random stuff because it is on sale or looks nice.”

This kind of so-called mission shopping, where a consumer buys one bargain-priced item and then leaves, will hurt profit margins, Goyal said. It may also explain why the number of shoppers increased and their spending fell, she said.

“That’s really bad for retailers,” Goyal said. Historically, Black Friday deals used to be the best of the year. Now that there are only a few items like that, consumers “are buying those and walking out the door.”

In one of the other early reads on results, sales at brick-and-mortar stores on Thanksgiving and Black Friday posted an estimated 2.3 percent gain to $12.3 billion, according to a report from ShopperTrak, the Chicago-based research company. The results were in line with ShopperTrak’s prediction for holiday purchases to gain 2.4 percent, the weakest since 2009.

The continued rise of e-commerce also may have kept some shoppers at home. Total e-commerce sales reached $20.6 billion in the first 29 days of this holiday season, ComScore Inc. said . That’s about 3.1 percent more than the period from Nov. 1 to Black Friday last year, the research firm’s data showed. The 2013 numbers include a few more shopping days because Thanksgiving fell on a later date this year.

Amazon.com Inc. (AMZN) was the most-visited online retailer on Black Friday from home and work desktop computers, followed by EBay Inc. (EBAY) and Wal-Mart’s site, ComScore said.

Target said it had twice as many online orders early on Thanksgiving morning as a year ago. Amazon.com lured shoppers by offering discounts as often as every 10 minutes during the holiday week.

Leave a Reply

Advertise Here
Advertise Here