Holiday sales fail to wow customers

By Lauren Coleman-Lochner  |   2008-12-29  |     NEWSPAPER EDITION

UNITED States retailers counting on post-Christmas sales to spruce up the sluggish holiday season may be disappointed as tapped-out shoppers turn their noses up at discounts of 70 percent or more.

"This week isn't going to do it," Burt Flickinger, managing director of Strategic Resource Group, a retail-industry consulting firm in New York, said in a Bloomberg Television interview. "Consumers are more cash and credit-constrained than ever before. After a 25-year spending tsunami, they've shifted from spending to savings."

Macy's Inc, a department store chain, slashed prices for diamond earrings in 14-carat white gold by 64 percent, while Circuit City Stores Inc took US$500 off a 40-inch high-definition television from Samsung. The discounts come as the US International Council of Shopping Centers has projected the worst US holiday sales decline in at least four decades.

Mariel DeBernard was ready to be wowed by the sales when she turned up on Friday at the Fashion Centre at Pentagon City mall in Arlington, Virginia.

"Normally I'd be loaded down with things, but there just aren't that many deals, particularly for clothing," said DeBernard, a 40-year-old homemaker. "For most things, the prices aren't that different than before Christmas."

US retailers count on the holiday season for a third or more of annual sales. They're now scrambling for business as consumers retrench to cope with shrinking home and stock values, tightening credit and the highest unemployment rate in 15 years.