Last Shopping Weekend Before Christmas Disappoints
New York, NY, Dec. 22--The critical last weekend before Christmas didn't deliver the sale bonanza merchants were hoping for, with Wal-Mart Inc. announcing that last-minute buying showed "some improvement" but wasn't enough to offset weak business in the early part of the month.
The world's largest retailer on Monday said that December same-store sales growth was still tracking at the low end of its projected 3% to 5% range. For the second week in a row, traffic was down from year-earlier levels for the week ended Friday, the company said on a prerecorded conference call.
Target Corp. said its same-store sales for last week were below its plan, both for its discount Target division and for the overall corporation. In addition, same-store sales for the month through Saturday were also below plan, Target said in a recorded message Monday.
Target's December same-store sales forecast called for an increase of 5% to 7% at its Target chain, with results expected to be one percentage point lower for the overall company. Target, based in Minneapolis, also owns the Mervyn's and Marshall Field's department-store chains.
Same-store sales, or sales at stores open at least a year, are considered a valuable indicator of a retailer's health.
At the Target division, the strongest merchandise categories were pharmacy, domestics, household personal and baby, and entertainment. Men's apparel, home decor and electronics were the weakest departments. Stores in the mid-Atlantic and Northeast outperformed stores in the rest of the country.
The federal government's raised its terror-alert status on Sunday could also be a headache for merchants, which are counting on heavy shopping this week to meet their goals.
The threat could reduce retailers' ability to have a huge business on Monday and Tuesday, and the week after Christmas, said C. Britt Beemer, chairman of America's Research Group. "It may likely make people who are close to being done decide they've purchased enough."
Some industry representatives disagreed, however.
"Consumers learned to be vigilant, and I don't think this will have an effect" on their shopping, said Karen MacDonald, a spokeswoman at Taubman Centers Inc., which owns and manages 31 shopping centers in 13 states.
Ellen Tolley, a spokeswoman at the National Retail Federation, agreed, saying that "since Sept. 11, consumers have learned to go on with their lives," and she doesn't foresee traffic being hurt.
Discounters and luxury stores fared best this past weekend, according to Beemer. But at midpriced department stores and mall-based apparel chains, which deepened price cuts on sweaters, jewelry and other items, sales were uneven, continuing the trend seen throughout the season, Beemer said. "I think it was a very strong weekend, but I don't think it was as big as retailers needed," said Beemer, based on interviews with retail clients. He added that consumers "were looking at the lowest price in each category of merchandise."
