Retailers Gear Up for Saturday Sales
Friday December 20, 11:44 am ET
By Emily Kaiser
CHICAGO (Reuters) - It pays to procrastinate this holiday season as U.S. retailers slash prices on everything from DVDs to diamonds, hoping to lure last-minute shoppers on the Saturday before Christmas.
Consumers will be able to choose from some of the season's biggest discounts and round-the-clock sales on what has become the biggest shopping day of the year.
With many Web sites now charging a fortune for guaranteed Christmas delivery, retailers are counting on even dot-com devotees venturing out for those last few gifts.
Friday's newspapers were filled with coupons for extra savings on already marked-down items. Some chains are starting early-bird offers at 7 a.m. on Saturday or offering special discounts for shoppers who use in-store credit cards, which bolster profits with fat interest fees.
Holiday sales got off to a strong start in the weekend after Thanksgiving, but most retailers reported sluggish demand in the first half of December, hampered by uncooperative weather that kept shoppers at home -- and often clicking on Internet retail sites.
The latest online sales data from comparison shopping service BizRate.com showed sales reached $262.8 million onWednesday, down 28 percent from the week before. From November 1 to Dec. 18, sales grew a strong 42 percent to $11.1 billion from $7.8 billion a year earlier.
Analysts attributed the gains to free shipping offers, but most of these have expired, causing sales to drop off.
Orders placed on Friday with leading Internet retailer Amazon.com Inc. (NasdaqNM:AMZN - News) should arrive in time for Christmas -- if they're for items that usually ship within 24 hours.
On Friday morning, the Web site rang up a $14.25 shipping and handling fee to deliver the $32.99 LeapFrog Imagination Desk -- which Amazon.com ranked as its top customer choice -- in time for Christmas. For one-day shipping, the cost soars to $25.55.
LAST-MINUTE ADVANTAGE
Television advertisements show brick-and-mortar retailers are well aware of their advantage in the last-minute shopping arena. Wal-Mart Stores Inc. (NYSE:WMT - News), the world's biggest retailer, has been running ads promising its stores will be well-stocked, even on Christmas Eve.
Sears, Roebuck and Co. (NYSE:S - News), the largest U.S. department chain, was one of many "clicks-and-bricks" retailers offering the best of both worlds -- online ordering and in-store pickup.
The company was taking 50 percent off fine jewelry and offering zero-percent financing on everything from vacuums to treadmills.
Discount retailer Kmart Corp. (NYSE:KM - News), which needs a strong holiday season to meet its goal of exiting bankruptcy by July, will keep its stores open for 110 hours nonstop from 6 a.m. Friday through Christmas Eve for the second year in a row.
Analysts are expecting retailers to post only a modest sales gain in a year clouded by a soft economy, heavy job cuts and the threat of war with Iraq. Consumer confidence levels have inched up in recent weeks, but still languish near nine-year lows.
Even holiday destination stores like toy and electronics retailers are reporting disappointing results.
Top electronics retailer Best Buy Co. Inc. (NYSE:BBY - News), which books the bulk of its profit during the holiday season, cut its earnings outlook earlier this week, saying sales at stores open at least one year will probably come in flat for the quarter ending in February.
The company was offering popular DVDs, including "Minority Report" for $15.99. Amazon.com had the same movie for $19.49, plus shipping and handling.
FAO Inc. (NasdaqNM:FAOO - News), parent of FAO Schwarz and Zany Brainy toy store chains, warned it is likely to file for bankruptcy unless its bank helped it out of a liquidity crisis.
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