After Thanksgiving spending could fluctuate

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By Gayle Deaton

Denise Jesse said she plans on spending less on Christmas shopping this year than last year.

Jesse, who was out shopping at Wal-Mart Wednesday with her two grandchildren, said her holiday budget is tighter this year because both she and her husband are facing lay-offs this season with their employer, Martinrea.

"Most everybody was used to getting all the overtime they wanted," Jesse said, "but now, it's down to nothing. People need to buy American."

Karen Holt said she's running behind and hasn't even started her Christmas shopping yet.

"I'll probably spend about the same amount as I always do," she said. "But I look for bargains."

Area retailers say they are expecting this year's sales to be the same as last year if not better.

Bettina Moody, manager of Goody's Family Clothing, said she expects sales to be about the same as last year, maybe even a bit better. Goody's doors will open at 4:30 a.m. Friday, Moody said, but all of the door-buster sales will last until the doors close at 11 p.m.

Jordan Anderson, manager of the Image Tree, said she believes sales will be better than last year.

"I think it's going to be good," she said. "It started off a little slow but it has picked up so I think it's going to be better than last year."

Anderson's store will open its doors Friday at 10 a.m. and close at 6 p.m.

Shelley Goodwin, executive director of the Shelby County Chamber of Commerce, said she can't imagine that the day after Thanksgiving wouldn't be as busy as it always is for retailers.

"The National Retail Federation expects a slight increase in holiday sales from last year," Goodwin said, "and they've done a study that shows 70 percent of people haven't started their holiday shopping yet. Those are both positives for our retail market around here."

Goodwin, who said she always shops on the Friday after Thanksgiving but not early, said she believes that retail spending will stay constant although people may choose to be more conservative in the types of gifts they give.

"I think people like to give and they have developed spending habits over the years," she said. "I think if there is a change, it may show up in what they're buying and not how much they spend."

National projections indicate retail sales are expected to be up about four percent this holiday season over last year.

However, the amount consumers have to spend on gifts will be limited by higher gas prices and anticipated higher heating oil costs, according to Purdue University retail expert Richard Feinberg.

He predicts for every dollar spent on fuel, one dollar less will be spent on the holiday.

"Fuel prices are just like a tax on consumer spending," Feinberg said. "This is not good news for retailers who have had higher costs and will have greater promotional expenses as they spend more money trying to get people into the stores."

Home heating oil is expected to go up 25 percent or more this season, which also will leave consumers with less disposable income to spend if temperatures drop in November, Feinberg said.

"Holiday sales are very sensitive to small but extreme economic and geopolitical events, such as fuel costs," he said. "This disproportionately affects lower-income consumers, which hurts discount stores the most. The possibility of a downside for discounters is greater than the possibility of an upside."

Feinberg estimates retail holiday sales in the United States will be $475 billion to $500 billion in 2007.

He said his research data indicate holiday sales of consumer electronics, jewelry, video games, CDs, DVDs and clothing are expected to be the most popular categories for spending this year.

The official starting day for holiday shopping is the Friday after Thanksgiving, called "Black Friday" because it was traditionally a day when retailers could turn their balance sheets to profitability. There are 32 shopping days between Black Friday and Christmas, which is the maximum possible number of days. But Purdue Retail Institute research shows no relationship between the number of available shopping days and the totals rung up on cash registers.

"Because Christmas is on a Tuesday, our research shows the biggest shopping day of the year will be Dec. 22, the Saturday before Christmas," Feinberg said. "Retailers will be pressed to exceed their sales expectations, so there is very good reason to wait to the last weekend to shop. We expect exceptional sales and promotions for shopping this last weekend."