Stores Still Not Celebrating After Holiday

Shoppers in Southern California and around the nation clogged stores and malls Sunday, picking up steeply discounted clothing, household goods and accessories. But the weekend’s post-holiday bargain hunting did little to alter retailers’ laments that the 1998 shopping season will go down in history as nothing more than a so-so year.

Still, buying was up from last year in some areas. At Moreno Valley Mall in Riverside County, favored items included jewelry, women’s apparel and toys. General Manager Donna Farrell attributed the rise to the opening of new stores in her mall during the last year and to an improved Inland Empire economy.

Macy’s West, a unit of Federated Department Stores Inc., reported brisk jewelry and watch sales at its 103 Macy’s stores in California, Nevada and Texas. The chain also accommodated a wave of shoppers who bought wrapping paper and other Christmas items far in advance of next year’s holiday.

But anecdotal observations at other Southern California malls indicated that shopper traffic was relatively ho-hum on Sunday, despite retailers’ hopes that a post-Christmas surge would allow them to meet the season’s optimistic sales forecasts. “It was really slow after the mall opened at 10 a.m., and it didn’t pick up until 11:30 or noon,” an Ontario Mills mall employee commented.

A healthy economy has failed to translate into boom times for retailers this holiday as many had hoped.

Tony Mims, a manager at Dayton Hudson Corp.’s Target store near the Sports Arena in San Diego, said traffic was “about normal, nothing extreme” on Sunday, further noting that the hot items were half-price Christmas tree ornaments, paper and containers. “They’re looking for stuff they can store until next year,” he said.

Deep discounts were the rule of the day at many Southland stores. In addition to cutting shelf prices as much as 50%, department stores such as Macy’s and Robinsons-May offered post-holiday shoppers newspaper coupons for an additional 20% off. But many of those offers had been available earlier in the shopping season and may not have fired up consumers as hoped.

Shoppers at J.C. Penney stores found storewide savings of as much as 50% on such items as luggage, shoes, outerwear and apparel. Federated’s Bloomingdale’s also had storewide clearance with as much as 50% off on all fall and winter fashions for men and women and for the home.

“Victoria’s Secret was having a sale, so I wanted to take advantage of it,” said Martha Smith, a librarian shopping at Regency Square Mall in Jacksonville, Fla., one of the many malls banking on price cuts to help meet sales forecasts for the season, which can account for as much as half of annual profits.

Still, the weekend surge was not enough to meet sales projections for the holiday, analysts said. Estimates of year-to-year Christmas sales increases seemed to average in the 4% range in Southern California and across the nation, although some analysts thought that figure was too optimistic.

“I don’t think the Grinch stole Christmas this year, but he was certainly knocking on the door,” said retail consultant Britt Beemer of America’s Research Group.

Same-store sales slowed from a strong start as the holiday progressed because warm weather dampened demand for jackets and other apparel. Shoppers also seemed to procrastinate or wait for steeper discounts.

Some held out hope that, with one week of the holiday shopping season to go, it would still be a success. Last year, the final two weeks of December accounted for half of holiday sales.

The big discounting has moved some analysts to reduce earnings estimates on department store chains such as J.C. Penney and May Department Stores because of the amount of inventory they had and the discounts needed to clear the shelves for spring merchandise.

A bright light in the retail universe was that sales at discounters such as Wal-Mart Stores Inc. and Kmart Corp. are meeting or exceeding forecasts because there is strong demand for household goods and low-priced clothing.