Holiday shoppers may see big discounts soon
NEW YORK -- If shoppers don't show up in stores soon, more 70 percent off sale signs will.
After a promising start to the holiday shopping season over the four-day Thanksgiving weekend, sales have slowed as worries about weak U.S. job growth and other concerns have caused Americans to spend less.
That puts pressure on J.C. Penney, Macy's and other stores, which had been offering fewer discounts this season than they did last year, to step up promotions to lure shoppers like Ron Antonette from Long Beach, Calif.
Antonette so far has spent about $1,000 on Legos, a Wii U game console and Apple's iPad Mini tablet computer for his two young children. Even though that's just half of what he planned to spend for the season, Antonette has stopped shopping over fears that Congress and the White House won't reach a budget deal by January. A stalemate would trigger tax increases and spending cuts known as the "fiscal cliff."
"I basically stopped moving forward in buying," said Antonette, 44, who runs a small public relations business and worries that he might not be able to take mortgage deductions on his house next year. "I feel like we're in financial limbo."
Antonette isn't the only shopper who feels that way. Major stores don't discuss sales during the holiday shopping season, but Wal-Mart CEO Mike Duke said that in a poll last month of shoppers of the world's largest retailer, an overwhelming majority said they were aware of the threat of higher taxes. And some said it would lead them to cut back their holiday buying, he said.
Overall, holiday sales are up 2.2 percent to $659 billion from Nov. 1 through last Saturday, according to an analysis of sales data done for The Associated Press by ShopperTrak, a Chicago-based firm that tracks spending at 40,000 stores across the country. That's slightly below the 2.7 percent increase over the Thanksgiving weekend when shoppers spent $22 billion.
The modest increase means sales for rest of the season will be crucial for stores, which make as much as 40 percent of their annual revenue in November and December. With only about a week and a half left until Christmas, stores have a ways to go in order to reach ShopperTrak's forecast of a 3.3 percent rise in sales during the two-month stretch compared with the same period last year.