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Gray Thursday: Increased Sales, or Black Friday Suicide?


This year, many more big-box retailers are opening their doors just as shopper bellies are digesting their Thanksgiving dinners. But is the effort really worth the cost?

MINYANVILLE ORIGINAL Black Friday once kicked off the holiday spending season in America, despite the fact that it wasn't actually the biggest shopping day in terms of retailer profitability until 2005. However, the trend has continued; a record 226 million shoppers visited stores and websites over the 2011 Thanksgiving weekend.

Last year also marked the arrival of new retailer trend aimed at holiday deal-seekers: Opening deals once-reserved for Black Friday, on the night of Thanksgiving. Now dubbed Gray Thursday, the strategy appears to have been a competitive edge for retailers like Toys R' Us and Wal-Mart (NYSE:WMT), who opened at 9:00 p.m. and 10:00 p.m., respectively, on Thanksgiving in 2011. Best Buy (NYSE:BBY), Target (NYSE:TGT), and Macy's (NYSE:M) opened their doors at midnight to kick off Black Friday. More retailers have jumped on board with Gray Thursday this year, causing others to up the ante with even earlier opening times.

This year, Kmart (though technically open most of Thanksgiving day), will begin in-store "Thanksgiving night" pricing at 8:00 p.m, as will its partner company Sears (NASDAQ:SHLD), as well as Toys 'R Us and Wal-Mart. Target will follow suit at 9:00 p.m. Though Best Buy will hold shoppers off until midnight, it will provide tickets for those in line up to two hours before the store opening for first access to deals.

Though the earliest-bird-gets-the-worm logic behind Gray Thursday should theoretically drive retailer sales for those who are open, a company's bottom line is the sum of many parts, among them, brand image, accurate inventory planning, employee satisfaction, and the customer service and experience that ultimately determines loyalty and repeat business.

Though many smaller boutique-style stores, malls, and small businesses haven't tossed the idea of Black Friday door-busting on its ear, Gray Thursday is shaping up to be the new norm for major big-box retailers competing for holiday market share. But, extending the holiday shopping season could present some gray areas for retailers. Here's why.

The Cost of Disgruntled Employees

Though employees scheduled to work on a holiday such as Thanksgiving receive compensation for overtime and holiday hours based on labor laws, making Thanksgiving a typical workday in the retail world could amount to other costly employer headaches, specifically, if all levels of retail management are not abreast of the many legal loopholes the shift presents.

Keith Gutstein, labor and employment law expert at Kaufman Dolowich Voluck and Gonzo, says that beyond the issue of compensating hourly employees whose work week exceeds 40 hours due to shifts that begin on Thanksgiving and seep into Black Friday, some states have premium pay laws that require additional compensation for employees working in excess of a certain number of hours in a particular day-which may or may not meet the standard "40 hour a week" criteria."
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