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HOLIDAY SHOPPING SEASON RATED 'B-MINUS' BY RETAIL GROUP

As holiday shopping seasons go, the one just ended was rather ho-hum.

Shoppers packed malls and shops across New York State over the past several weeks, but failed to spend as much as many retail observers had predicted and merchants had hoped.

Overall, sales volume for the Nov. 28 through Dec. 29 period rose between 3 and 5 percent over last year, according to the Retail Council of New York State, earning the season a "B-minus" letter grade.

James A. Quaremba, the council's president and chief executive officer, said the grade is an average of retailer experiences, which included a wide range of sales outcomes.

"We heard from some retailers who, looking back on the season, may have hoped for more activity," Quaremba said. "On the other hand, it's important to note that we had retailers who performed tremendously well. There were more than a few grades of "A-plus" in our survey."

A manager of a mall-based national apparel chain with several Buffalo-area stores was among those who expressed disappointment with holiday sales volume. The merchant, who requested anonymity, said even as "sale" signs went up, consumers failed to turn up at the cash register with mounds of purchases.

"It was a pattern of one or two items, not the armfuls we'd like to have seen," the retailer said. "Even when we went to 30 and 40 percent off, the quantity just wasn't there."

But as the council survey found, other retailers were ecstatic with Christmas 1997, particularly independent shopkeepers who saw a lot of consumers doing "niche buying."

Ted Potrikus, the retail group's executive director, said it's possible that shoppers sought out the "different and unique," rather than piles of mass-produced gifts.

"That's pure speculation, but it would explain why the independent specialty guys seemed to fare better, some with high double-digit increases," Potrikus said.

Edward and Maureen Pinkel, owners of Urban Surf and Snowboard Shop and Shipyard Men's Clothing and Gifts on Elmwood Avenue in Buffalo, count themselves among the winners of Christmas '97.

"We were right where we wanted to be and met our expectations," Ed Pinkel said. "It was a really satisfying year for us."

The two small shops also bucked the trend of using last-minute sales and giant discounts to make their holiday quota, a rarity this season.

"We never put anything on sale," Pinkel said. "Every sale was full price and nobody complained. I think when people come in here they realized they are getting well made, high-quality merchandise that's worth the price. It's an honest way to deal with the customer and allows us to control our margins."

Other small shops along Elmwood reported similar success in recent weeks, with a steady flow of customers and solid sales. If there was any damper on their success, it was the absence of the Village Green bookstore, which served as a drawing card for the street for a number of years. The store closed its doors last summer due to corporate problems.

Pinkel was among those who noticed the negative impact of its demise.

"It was a prime destination which would result in people taking a walk down Elmwood and discovering the rest of us," he said. "It's tough having the building dark."

It appears New York state merchants may have fared better than those across the nation as a whole. Overall, it is likely that retailers' 1997 holiday sales may fall short of even the modest 3.8 percent growth predicted by the National Retail Federation. Now, some think retailers will be lucky to eke out an increase of 2 percent to 3 percent.

What many retailers are missing is a fundamental change in how people think about Christmas shopping, according to George Rosenbaum, chief executive of Leo J. Shapiro & Associates, a Chicago-based consumer research firm.

"People increasingly feel they control Christmas spending," Rosenbaum said. "For the past three or four years, they have been pulling back from Christmas, using it as a way to maintain control of family budgets."

Other factors that may have made consumers jumpy about overspending include large layoff announcements from blue-chip corporations such as Eastman Kodak and the collapse of some Asian currencies, which roiled U.S. stock markets, Rosenbaum said.

And it's important not to overlook the dampening role played by record levels of consumer debt and 1.3 million personal bankruptcies during 1997, adds Kurt Barnard, president of Barnard's Retail Trend Report in Scotch Plains, N.J.

For the past several years, many families have been splurging on a computer in August or September when the kids head back to school, leaving them strapped when Christmas comes only a few months later. That helps explain why computer software was hot this Christmas but actual personal computer sales were only so-so, Barnard said.

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