Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Bleak Friday


Amid declining consumer confidence, kickoff to holiday shopping season looks mixed.


This year's Black Friday won't be so sunny for the nation's retailers.

Black Friday, the first shopping day after Thanksgiving and the traditional kickoff to the holiday shopping season, is often the day that nudges retailers into profitability for the first time of the year. Black Friday doesn't forecast holiday sales, but is often a good gauge of shoppers' willingness to spend. Last year, the weekend after Thanksgiving totaled about 10% of holiday sales.

This year isn't looking good amid the credit crunch and declining consumer confidence. Many retailers stress sales in an effort to get what they believe will be reluctant shoppers through the front door.

In general, analysts look for flat-to-declining sales this holiday season. The dollar total may be up thanks to inflation, but unit sales are expected to fall about 1%. The Nielsen Consumer Household survey found that 33% of the nation's households across all income levels are likely to spend less this holiday season.

Retail chains are extending hours by opening unusually early, or keeping door open until midnight. Market segmentation, sharply defined categories and retail channels will be vital to preventing a downbeat year from becoming a disaster.

Just about everyone is getting into the act this year: Wal-Mart (WMT) will try to entice shoppers with a Blu-ray player for $128. Best Buy (BBY) plans to offer coffee and donuts for shoppers lining up before it opens its doors at 5:00 a.m. Target (TGT) will give customers store maps showing the location of sale items.

But sales and endless ballyhoo may not be enough to boost sales. Plunging home prices makes people feel poor. And the unemployment rate is now 6.5%, up from 6.1% in October, which leads many people to sit on their money.

Unfortunately, declining retail sales mean less sales tax revenue for state and local governments. Many states and cities overspent during the boom years and now face a budget crunch.

Last year's holiday online sales were up about 19% over 2006. The forecast for online sales ranges from a slower rate of increase to a slight decline Forrester Research expects online retail spending to total $44 billion in November and December, up just 12% from last year.

Here's betting Black Friday opens strong, but sales activity declines throughout the weekend.

< Previous
  • 1
Next >
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos