Holiday shopping watchword: Bargain, bargain, bargain

SANDUSKY Christmas is coming, but that proverbial goose is getting lean -- not fat. W
Annie Zelm
May 24, 2010

SANDUSKY

Christmas is coming, but that proverbial goose is getting lean -- not fat.

With Thanksgiving falling nearly a week later this year, the race is on for retailers to sell more holiday goodies at a time when many shoppers are already trimming their budgets.

Many traditional retailers say they are being cautiously optimistic as they ring in a potentially flat sales season, while more discount stores are rejoicing.

"I think across the board, all retailers will feel challenged this year," National Retail Federation spokeswoman Kathy Grannis said. "(But) we believe that as we get further into the holiday season, we'll see consumers who have saved up and will use sales and discounts as a great way to invest heavily in bargains."

The National Retail Federation predicts customers will spend about 1.9 percent more on holiday shopping than they did last year -- the lowest increase in planned spending since the federation began its annual survey of customers in 2002.

The survey, conducted by BIGresearch, found U.S. consumers plan to spend an average of $832.36 on holiday-related shopping -- just a few dollars more than the $816.69 they spent last year.

About 40 percent of consumers surveyed said they would start their holiday shopping before Halloween, which the NRF believes indicates a desire to spend more time shopping around for lower prices and stretching their money out over a longer period.

And nearly 70 percent said they planned to do at least some of their shopping at discount stores this year.

Sandusky residents Michael and April Brennan are among them.

Brennan, 47, said he and his wife wanted to make sure they found plenty of good deals -- especially on toys and games for their grandchildren -- before it was too late.

"We got a lot of it done last week at Kmart in Lorain," Michael Brennan said. "Layaway is very important to us, and they have it."

Holidays on hold

With many shoppers more reluctant to pay with plastic, experts say the age-old custom of layaway is making a comeback.

Kmart is among the few retailers who have kept the practice, allowing customers to make a series of smaller payments before bringing home the goods. Though Wal-Mart nixed its layaway program in 2006, some stores have brought it back this season to entice buyers. Kmart stores allow customers to hold items for up to eight weeks with a $5 service fee and 10 percent down payment. Other stores, such as T.J. Maxx, Sears and Burlington Coat Factory, have similar programs -- though the T.J. Maxx in Sandusky does not offer it. Sears stores across the nation -- including Sandusky -- just brought back layaway programs this week.

"In this difficult economic climate, extending the layaway program at Sears is an easy decision and one that we hope will provide additional value to our customers," Sears spokesman Don Hamblen said in a prepared statement. "We want our valued Sears customers to be able to stay within their holiday budgets this year. We're making that happen by offering the benefits of layaway, as well as Early Black Friday pricing -- all starting this weekend."

Sears shoppers can place a variety of merchandise ranging from toys, jewelry and fitness equipment on layaway through Dec. 22. They must have it paid in full by Dec. 23, according to store policy.

One Web site is also picking up on the trend.

Elayaway.com allows consumers to pay a $1.90 fee for every $100 worth of merchandise purchased from more than 1,000 retail partners. The site includes a calculator to help customers break down the price of their order into payments over a three to 13-month period. It automatically deducts payments from the buyer's bank account and delivers the order once all payments are made, according to the site.

Retail partners determine the length of time customers have to pay off the items, but the average term is about three-and-a-half months.

Beefing up bargains

While many retailers are rolling out new incentives and displaying deals in prime spots, stores that have always had deep discounts are busier than ever.

Brady Fry, manager of Ollie's Bargain Outlet on Perkins Avenue, said the store began its holiday transformation toward the end of September and started picking up in sales right after Halloween.

"The general attitude of customers (is that) bargains have been well accepted because of the economy, and we do carry quality products," Fry said.

Decorative holiday items, such as inflatable snowmen and Santas, are especially popular at the discount store -- which carries name-brand merchandise up to 70 percent cheaper than in traditional retail stores, Fry said. Large inflatable Santas, which cost between $60 to $100 at most stores, sell for $18.99.

Unlike shopping mall stores, Ollie's doesn't put on a big production for the holidays. While some items are displayed on tables in a sort of seasonal smorgasboard, most are stacked up in cardboard boxes that nearly reach the ceiling -- with the goal of packing in as much discounted merchandise as possible. Customers aren't likely to find every item on their wish list here, but they'll probably encounter a few surprises.

"Our stores are not fancy, but selection and price are there," Ollie's CEO Mark Butler said. "You can't come in and expect to find a Toastmaster toaster, but you might find a Black & Decker toaster, and it's cheap. We think the consumer might be a little more lenient on their choices this year and focus more on prices and quality."

Other discount stores, such as T.J. Maxx, are also reaping the benefits.

"We're able to buy our merchandise much closer to the season because we're in the market buying it every single week, and we can turn it around quickly," T.J. Maxx spokeswoman Laura McDowell said. "We're able to be smarter about inventory, trends and negotiating a better price. While department stores are having a lot of problems right now trying to get rid of merchandise, we're buying it."

Target spokeswoman Hadley Barrows said the store still expects about a 6 to 9 percent decrease in November sales due to the timing of Thanksgiving Day and soft sale trends. But they hope to make up for it by offering plenty of name brands for every budget.

"Our 'expect more, pay less' promise has worked for us in all kinds of economic climates ... but this year, we're focusing more on the 'pay less' side of the brand promise," Barrows said.

Toys stand strong

One area many retailers don't seem worried about are their toy shelves.

Though expectations in general are lower this holiday season, even the most cash-strapped shoppers are still willing to shell out for the kids, said Joe Bell, spokesman for the Cafaro Co., the parent company of the Sandusky Mall.

"This year, there's still an emphasis on small electronics and electronic gaming," Bell said. "You're also going to see retailers push toys that get children moving, like (Dance Dance Revolution.)

Others are focusing on do-it-yourself gifts that promote hobbies like indoor gardening and crafts.

And in leaner times, families seem to cherish toys that bring them closer.

"There may be more family purchases like board games and arts and crafts -- things everyone can do together," said Adrienne Citrin, spokeswoman for the Toy Industry Association. "We're seeing a back-to-basics trend and a resurrection of things like game night (because) families are staying home more often."

Toys 'R Us spokesman Bob Friedland said toys come in such a wide range of prices that they are one of the few items still affordable for most.

Top toy trends include animatronics like Elmo Live, music instruments for kids such as the 30-inch acoustic guitar, science-based and educational toys, as well as toys that teach kids to save money.

Port Clinton resident Jean Thropp, 62, said she still planned to buy some of the most popular toys for her grandchildren this year. But because she lives on a fixed income, she has to be more choosy about where she shops for them. She was happy to find low-priced Transformer toys and a Fisher Price set for $14.99 at Wal-Mart for her out-of-town grandson.

"I've always been a bargain shopper, especially this time of year," Thropp said. "My family knows I'm on a budget, but I just want it to be a special Christmas."