With a bleak report on the holiday retail season raising questions about the economic recovery, local and national retailers hope that the next few days of after-Christmas shopping brings a spending spike.
The last week of December can be a big time of year for us. We kind of look at it as a 13th month, said Roddey Player, president and CEO of Queen City, which sells appliances, electronics and mattresses.
Nationally, the final week accounts for about 15 percent of December retail sales, said Michael McNamara of MasterCard Advisors SpendingPulse.
A SpendingPulse report released Tuesday cast a pall on hopes for holiday spending. It found that sales of electronics, clothing, jewelry and home goods in the two months before Christmas were up only 0.7 percent over 2011. Thats well below the 3 to 4 percent growth analysts had predicted, and the weakest year-to-year performance since 2008, when the Great Recession kicked in, The Associated Press reports.
U.S. stocks fell Wednesday, the first day of trading after the Christmas holiday. Major U.S. retailers including Abercrombie & Fitch, Sears Holdings, Urban Outfitters, Limited Brands, Nike and Gap were all down. Handbag maker Coach, a bellwether of the luxury market, plummeted $3.13 to $54.40. It lost more than 5 percent of its value, more than any other company in the S&P 500.
Amazon.com, which helps analysts get a read on the entire retail market, was down 4 percent, losing $10.24 to $248.38.
The SpendingPulse report is the first major snapshot of holiday retail sales.
ShopperTrak, which plans to release a report on the pre-Christmas week Thursday, stuck to a brighter view, though the company had earlier scaled back its growth projection from 3.3 percent to 2.5 percent.
ShopperTrak continues to stand by its revised estimate for the season of a 2.5 percent sales increase over 2011, spokeswoman Molly Reynolds said in an email Wednesday. ShopperTrak uses foot traffic at 50,000 locations to calculate sales nationwide.
Charlottes Northlake Mall is predicting year-to-year growth between 2 and 4 percent, said marketing director Nan Gray. My stores tell me that traffic is down but sales are up, Gray said.
Early Wednesday afternoon, Northlake was busy but not packed.
We even got a good parking place, said Denise Broome, who brought her 15-year-old daughter, Kristina, in from Salisbury to spend Christmas money.
It hasnt been as bad as I thought it would be, said Stefanie Howell of Atlanta, who joined her Charlotte friend, Jenee Campbell, in a quest to spend gift cards on clothes and shoes. The women said they found good sales, but may return later in hopes of deeper discounts.
Charlotte-area merchants offered mixed reports on the season so far and Wednesdays post-holiday business.
Player said he expects the four Queen City stores to end the holiday season 7 to 10 percent over 2011s sales figures, and said business was good Wednesday.
Its been a tough road for the last couple of years, but Im seeing some hope in the last couple of months, he said.
Holiday spending at Brownlee Jewelers in Park Road Shopping Center is definitely up, said manager Michelle Pavlakos, who didnt have numbers. She said her store saw a steady stream of shoppers Wednesday, from folks buying watch batteries to couples shopping for diamonds. A lot of people get engaged on New Years, she said.
But at Pura Vida Worldly Art in Charlottes NoDa neighborhood north of uptown, sales are down slightly from last years holiday season, said owner Teresa Hernandez. She blames the convenience of online shopping and the lingering effect of the recession.
Despite a slow Wednesday, Hernandez voiced optimism. I see it coming up slowly, she said. Im hopeful.
Analysts blame everything from Superstorm Sandy to the looming impact of the federal fiscal cliff for squelching holiday spending. Some have even speculated that the mass shooting of Connecticut schoolchildren earlier this month may have eroded enthusiasm.
Marshal Cohen, chief analyst at the market research firm NPD Inc., said even steep discounts didnt spur impulse shopping.
We had one reason after another for consumers to say, Im going to stick to my list and not go beyond it, Cohen said.
In Charlotte, the weather may have been too good, said Northlakes Gray. She said coats and other winter gear havent sold as well as they might have with more wintery weather.
Wednesday mornings downpour threatened to douse post-holiday shopping, but as soon as the rain eased the shoppers arrived, Gray said.
In spite of the recession, this is what we want to do, said Anita Fountain of Charlotte, a veteran of day-after-Christmas sales. Its kind of like making a happiness for yourself.
ShopperTrak predicted that Wednesday wouldnt be a particularly strong post-Christmas shopping day, landing in the middle of the week with many adults returning to work. Last year Christmas fell on Sunday, with most getting a Monday holiday.
As the last few shopping days of the year play out and the holiday spending analyses continue, much is riding on how much money changes hands.
Spending by consumers accounts for 70 percent of overall economic activity, and November and December provide up to 40 percent of annual sales for many retailers, The Associated Press reports.
McNamara, of SpendingPulse, said weak sales could spill into 2013, as stores offer deeper discounts and make fewer orders to restock their shelves. That could lead to wholesalers buying less and orders to factories dropping in coming months, he said.
The Associated Press contributed.
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