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Early Data Shows Strong Black Friday
Despite the turmoil and all the anecdotal reports of sluggish Black Friday sales, seems that the actual sales data told a different story. The AP is now reporting that Black Friday sales increased by 3% over last year. This happening despite the month-to-month decline of 3% that occurred in October.
http://www.sfgate.com/cgi-bin/articl...business&tsp=1
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The holiday shopping season got off to a surprisingly solid start, according to data released Saturday by a research firm. But the sales boost during the post-Thanksgiving shopathon came at the expense of profits as the nation's retailers had to slash prices to attract the crowds in a season that is expected to be the weakest in decades.
Might be the case of perception shaping reality here, since just about everybody I talked to indicated that the crowds were smaller than they remember from years past. But, if stores increased their sales, I wonder where these revenues came from. At the Best Buy store where my friend works, he indicated that they still had the doorbuster TVs in stock at midday, whereas in years past those sets would be gone within the first hour.
It could also be a case where the discounting cuts more broadly and deeper than in Black Fridays past. The enticements aren't limited to just a few doorbuster deals. For example, Carter's put their entire store at 50% off beginning on Tuesday and going through Saturday.
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My wife and I briefly stopped at one of the malls today. Although it had traffic it didn't look like Christmas shopping season and it was Saturday. We pulled right into a parking spot as another car was pulling out, normally we'd have to circle the parking lot a couple times.
Although a friend of mine was in line at American at 2:30 am Friday morning. He said he was about 20th in line. He was after and succeeded in landing a Sony bd-p350 for $178.00
If it was me I think I'd get my sleep and go to the place that sells them regularly for $199.00.
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Wooch, that may be the report, but that wasn't at all what the sales people at CC, BB, MicroCenter, and even Costco told me. Of course, that's all local to SoCal, but if the rich mucky-mucks here aren't buying, then the average Joe probably isn't buying either.
I haven't checked, but I also read that the big toy manufacturers and distributors (Mattel, Toys 'R' US, FAO, etc.) all came down on Friday. Granted, the market has been up-ish since Monday, so that may just have been a blip, but I'm not holding my breath. I am, however, hoping that Visa comes back up before the end of the season....
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Most people I know are buying off the internet instead of shopping at local stores.
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Quote:
Originally Posted by nightflier
Wooch, that may be the report, but that wasn't at all what the sales people at CC, BB, MicroCenter, and even Costco told me. Of course, that's all local to SoCal, but if the rich mucky-mucks here aren't buying, then the average Joe probably isn't buying either.
That was what I heard from the front lines as well, but when the sales got tallied up, they showed an increase. What you're observing is perception. What the cash register totals provide is the reality.
Considering how far retail sales fell during October and November, some analysts I read suspect that there was a lot of pent up demand that got brought out via the Black Friday discounts. A lot of purchases got deferred during those months, so it makes sense that discounting would entice consumers make purchases that they had wanted to make earlier.
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Originally Posted by blackraven
Most people I know are buying off the internet instead of shopping at local stores.
That might be what you're hearing, but on the whole, remote retailing (which includes online, catalog, phone order, mail order sales of all stripes) still accounts for less than 10% of retail sales. Internet sites always report big percentage growth numbers, but they're starting from a much smaller base.
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I just don't see how this early on that any report could be accurate. When it is all said and done I'd like to see how it really turned out, it will probably illuminate the path we are headed down economically( or not, just for the sake of uncertain wishey-washieness). The only thing I know for sure is I'm not going to be spending quite as much as I have in the past.
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Well Wooch, I know the investment world is living in fear of the prospect of consumers holding off buying today out of anticipation for yet even bigger price cuts tomorrow.
Consumers think they're smarter these days (and many are). They know in a tough economy that demand drops and exerts downward price pressure (ignoring supply adjustments of course).
What we're wondering is if buyers' wide-spread belief of a better price later can actually force retail's hand to lower prices even more now. This is a nasty recipe for deflation, which is devastating and brutally hard to get out of.
Hope the data holds up and people are spending at a reasonable pace at least.
We might not know until much later, and here's a case where perceptions might adversely influence reality...
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Quote:
Originally Posted by kexodusc
Well Wooch, I know the investment world is living in fear of the prospect of consumers holding off buying today out of anticipation for yet even bigger price cuts tomorrow.
Consumers think they're smarter these days (and many are). They know in a tough economy that demand drops and exerts downward price pressure (ignoring supply adjustments of course).
What we're wondering is if buyers' wide-spread belief of a better price later can actually force retail's hand to lower prices even more now. This is a nasty recipe for deflation, which is devastating and brutally hard to get out of.
Hope the data holds up and people are spending at a reasonable pace at least.
We might not know until much later, and here's a case where perceptions might adversely influence reality...
If they send me another "Economic Stimulus" check, I'll spend it at a reasonable pace, at the very least. :yesnod:
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Originally Posted by Rich-n-Texas
If they send me another "Economic Stimulus" check, I'll spend it at a reasonable pace, at the very least. :yesnod:
What happened to the last liberal redistribution of wealth you got? :D
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Quote:
Originally Posted by Rich-n-Texas
Knock it off knucklehead!!! :incazzato:
Mwa ha ha ha...I just said it cause I knew it would rib ya, buddy! You'll recall I avoided most of those kinds of discussions.
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Knock it off knucklehead!!! :incazzato:
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Oh BTW, for some reason (L.J.) my finances are looking a bit thin, so as another way to keep the pace up, and as a way of showing how much everybody appreciates my time and effort here, I'll take the BFD as a Christmas/belated 5K post gift.
Sound good lemme know. :thumbsup:
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Quote:
Originally Posted by mbbuchanan
I just don't see how this early on that any report could be accurate. When it is all said and done I'd like to see how it really turned out, it will probably illuminate the path we are headed down economically( or not, just for the sake of uncertain wishey-washieness). The only thing I know for sure is I'm not going to be spending quite as much as I have in the past.
Given that all retailers tally up their daily returns at the end of the day, how would a report on Black Friday sales not be accurate? The bigger picture is not how this Black Friday's sales measured up to years past. They went up, but that's not the point.
The real story yet to be determined is how the whole holiday shopping season measures up. Black Friday is an indicator of where the holiday season is headed, but it's not foolproof. 2003 had record breaking sales on Black Friday, but once the total sales were tallied up after Christmas, that year turned out no better than the year before.
This year's holiday season will likely lag behind last year. For one thing, there are five fewer shopping days between Thanksgiving and Christmas. Also, retailers had already anticipated the slowdown and cutback their orders. Given these conditions, retailers can only achieve year-to-year growth by maintaining higher price points. That will all depend on how far shoppers deplete store inventories over the next week or two. If sales are strong, then stores won't feel as much pressure to deepen the price cuts given that inventory levels are already low.
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Given that all retailers tally up their daily returns at the end of the day, how would a report on Black Friday sales not be accurate?
Big-stores and major retailers were reporting, not smaller stores.Big electronic and department stores are not the only seller of goods and they are going to get their money one way or the other.
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Quote:
Originally Posted by kexodusc
Well Wooch, I know the investment world is living in fear of the prospect of consumers holding off buying today out of anticipation for yet even bigger price cuts tomorrow.
Consumers think they're smarter these days (and many are). They know in a tough economy that demand drops and exerts downward price pressure (ignoring supply adjustments of course).
What we're wondering is if buyers' wide-spread belief of a better price later can actually force retail's hand to lower prices even more now. This is a nasty recipe for deflation, which is devastating and brutally hard to get out of.
Hope the data holds up and people are spending at a reasonable pace at least.
We might not know until much later, and here's a case where perceptions might adversely influence reality...
I think that there's probably enough pent up retail demand to avert an all-out catastrophe, at least for the holiday season. People have to lay out a certain amount of retail spending just to maintain a household, and a lot of those purchases got deferred in October and November. If some of those deferred purchases are made in December, then that potentially makes up for reductions in gift spending and discretionary purchases.
It also helps that the lower gas prices might further loosen the purse strings for retail purchases. Between my wife and I, we're back down to a combined $40 a week for gas, whereas we were over $100 a week just two months ago.
I think the factor that might avert a deflationary cycle in the short term is simply lower inventories. Retailers had already planned for reduced inventory, and once the financial crisis hit, they canceled their remaining holiday orders. Because of how quickly the market conditions deteriorated in October and November, retailers shifted a lot of the holiday discounting early. The pricing they have in effect right now is what would normally occur in mid-December. If retail inventories get depleted more quickly, then the stores won't feel as much pressure to launch a more aggressive round of discounting.
The real catastrophe in retailing though might still happen in the early part of next year. With the new unemployment numbers and rumors buzzing about major layoff announcements early next year, I suspect that consumers will really start cutting back in January. Depending on inventory levels, that would be where any deflationary cycle begins.
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Quote:
Originally Posted by mbbuchanan
Big-stores and major retailers were reporting, not smaller stores.Big electronic and department stores are not the only seller of goods and they are going to get their money one way or the other.
Like it or not, the major retailers generate the vast majority of retail sales, and are a very good indicator as to the direction of the retail market in general. Many "smaller stores" are owned major retailers and participate in the same data reporting. If you say that they "are going to get their money one way or the other" then how does that explain the 18% drop in year-to-year sales that Best Buy experienced in October? Retailers were hammered hard in October and November, which makes the Black Friday numbers surprising (or not so surprising according to the analysts who expected Black Friday to be an outlet for pent up demand that got deferred for the last two month). Keep in mind that this is ONE DAY, and that same AP report mentions that retailers' profit margins are getting sacrificed to maintain the sales levels.
If the data reporting for this year's Black Friday was done the same way as last year, then why would the reported 3% increase somehow constitute an "inaccurate" finding? The only way for it to be inaccurate would be if last year's numbers included a different universe of store types than this year's.
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Looks like kex is psychic too!! Another one tearing hole in the time-space continuum (posts 10 & 11 are reversed)
Anyway, pay no attention to me. It's the day before my bosses Christmas party and I'm stoked. On Topic: He pumped $290. into the economy with his liquor purchase. :thumbsup:
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AT&T had big layoffs today as well as about 3 other companies, I haven't heard the news tonight to see how the auto companies turned out but this has to have people hanging on to their money wondering if they could be next.
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Well Wooch, it certainly isn't looking good for the economy as a whole. Black Friday was maybe not a dud (although I still have a hard time accepting that given how the local economy's been doing), but x-mas shopping isn't the only thing that makes up the Consumer Price Index.
One example that comes to mind is the automakers. Even if the automakers get their socialist check (I'm throwing Tex a bone, here) from uncle Sam, they will still be laying off tens of thousands and selling very little. Not only will year-end auto sales suck, but they are likely to stay low throughout next year, and that will have it's share of impact on the economy. Then there's the foreclosure numbers, the cost of this assinine nonsense war in Iraq, the huge expense of corporate welfare (aka socialism - Tex, are you there?), and the fact that our schools are putting out stunted grads, and you've got a recipe for several years of economic muck.
This morning Bush blamed the unemployment numbers on the savings & loan, oops, Freudian slip... I mean the housing crisis. Huh? Now how does that work? Isn't this the kind of disinformation and obfuscation that got us into this mess? The fact that nobody is questioning this nonsense tells me that we're headed for more economic misery because people don't want to accept that we're up sh*t creek.
So Wooch, what you're saying is that the retailers set their expectations so low this year, that what we saw this past weekend could still be passed off as an improvement? That's kind of like saying to a couch-potato that he will gain weight if he does nothing so when his weight stays the same, he'll actually be pleasantly surprized. Let's tell all our children to get D's and then we can celebrate when they pass with a C. Let's cut more social programs, that way we can throw more money at the few that are left. Let's boycott international treaties, then we can make a big deal when we sign an insignificant one. Let's send more troops to Iraq, so that the percentage of deaths & injuries seems lower. Let's set the presidential bar so low that even a black man named Hussein can get elected.
Hey wait a minute, this is how we do things in this country, huh?
OK, Agent Smith, can I have my blue pill now?
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NF, you are out of line with the "black man named Husane" thing. The fact that Barack got as far as he did shows no bar was lowered. One might have thought that, when Bush got elected. The fact that it's not Jessie Jackson or Fred Thompson shows that not just any knucklehead can get elected.
Maybe the road to recovery is partly in the hands of us. Instead of forecasting doom and gloom, walking around with our tales between our legs, we need to do what we can to help. And, when I figure that out, I will post for all to see. I know a few here have helped, they have gone Blu. Of course, it took great prices on good machines to do it but it got done.
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It would be nice if some people around here could get over the November 4 results or at least wait until someone is actual in the job setting policy before bashing them based on party line biases............
In any case after the news of this week I'd like to hope that sales on Black Friday were up. This is a consumer driven economy and any sign that those people who do have money are willing to spend it is good sign. My wife works in retail at a discount clothing store and overall business has been strong these last couple of weeks. They are however getting ready to make additional discounts now so that people will continue to come in and shop so they are operating on an even thinner margin despite their continued success.
If we could stop having a different bottle seemingly falling off the shelve each week causing turmoil in the market maybe we can start to get through this mess. It seems at this point everyone is in a reactive mode based on the last piece of bad news.
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Good point, maybe we should quit watching the news. It does seem like people can't get the bad economy out of their mind because if not every week, sometimes every day there is a major headline of something else happening to worsen the situation. You can't get excited about the stock market surge because it's followed by a just as large plunge. I think it's important to keep as positive of an attitude as we can though. Where's that American spirit? Everyone's assignment this weekend is to watch at least one John Wayne movie and a couple episodes of Star Trek :)
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Originally Posted by Mr Peabody
Good point, maybe we should quit watching the news. It does seem like people can't get the bad economy out of their mind because if not every week, sometimes every day there is a major headline of something else happening to worsen the situation. You can't get excited about the stock market surge because it's followed by a just as large plunge. I think it's important to keep as positive of an attitude as we can though. Where's that American spirit? Everyone's assignment this weekend is to watch at least one John Wayne movie and a couple episodes of Star Trek :)
YEAH, that will help.
Tell me, just how did we become a nation of such fools that we actually beleive
that something will happen if we just wish it?
500,000 jobs were lost last month, that is HUGE.
And if you work for a car company are you going to go out and splurge?
As for "pent up demand" that doesnt mean jack if you dont have the coin to satisfy the demand.
I have a "pent up demand" for a new Porsch and a new Mac amp, doesnt mean its gonna happen anytime soon.
Wooch's problem is that hes' been cooking the books for uncle sugar for so long
that he has lost touch with reality.
And now we have this idiot in office that is going to throw money at anything that moves.
Only problem is you dont go on a spending spree when you're broke.
WHICH WE ARE.
We dont even have any industrial base, its been moved off-shore.
Wanna know the future? LOOK AT THE PAST, AT germany between the wars, or more recently Argentina.
ONLY in such a large economy its gonna be at least ten times worse.
But heres the position mr P, if you insist on denying reality.
The tiger is gonna keep thinking you're a happy meal, even if you refuse to beleive he exists.:1:
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First of all and idiot in office already threw money at anything. The incoming president is planning to create jobs by embarking on one of the largest infastructure rebuilding projects in 50 years. So maybe, you, should, watch the news more.
My point is, sure times are bad, more so for some than others, but what should they do? I think you have to say we just took a hard shot and now how do we battle back. You seem to say, well I just took a hard shot so let's roll over and die.
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Originally Posted by nightflier
Well Wooch, it certainly isn't looking good for the economy as a whole. Black Friday was maybe not a dud (although I still have a hard time accepting that given how the local economy's been doing), but x-mas shopping isn't the only thing that makes up the Consumer Price Index.
CPI is a measure of inflation, not sales or demand. Get your terminology straight.
Like I said, Black Friday is but ONE DAY. It's quite easy to see how Black Friday went fine this year given how much discounting occurred and how many purchases got deferred from October and November.
And AS I SAID BEFORE, Black Friday does not always predict how the overall holiday shopping season will go. 2003 had a record-breaking Black Friday and mediocre sales the rest of December. This year could very well go the other way around.
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Originally Posted by nightflier
One example that comes to mind is the automakers. Even if the automakers get their socialist check (I'm throwing Tex a bone, here) from uncle Sam, they will still be laying off tens of thousands and selling very little. Not only will year-end auto sales suck, but they are likely to stay low throughout next year, and that will have it's share of impact on the economy. Then there's the foreclosure numbers, the cost of this assinine nonsense war in Iraq, the huge expense of corporate welfare (aka socialism - Tex, are you there?), and the fact that our schools are putting out stunted grads, and you've got a recipe for several years of economic muck.
Bad example and a whole lot of off-topic tangents. The auto industry is the single largest retail segment, but it is not a sector that depends on seasonal shopping. Despite what those Lexus and Mercedes commercials try to tell you, the holiday season is not critical to a dealership's bottom line since December isn't even the peak month.
For specialty retailers and general merchandisers though, the holiday season alone can account for upwards of 30% or more of a retailer's annual sales. The term "black Friday" came about because it was the symbolic day where a retail store goes into the profitability for the year.
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Originally Posted by nightflier
So Wooch, what you're saying is that the retailers set their expectations so low this year, that what we saw this past weekend could still be passed off as an improvement? That's kind of like saying to a couch-potato that he will gain weight if he does nothing so when his weight stays the same, he'll actually be pleasantly surprized.
Did you ever study economics or run a retail business (both of my parents owned small businesses where I helped them manage their inventory)? What you call low expectations, the retailers call survival. It has nothing to do with "passing off as an improvement," it has to do with doing everything necessary to generate revenue and reduce their inventories.
The retailers have already pulled back their orders, so they have less product to sell this year than they did last year. For them, the task between now and the end of the year is to maximize the revenue that they get out of that inventory. Normally, they hold back the big price reductions until the very end of the holiday shopping season. This year, they are front loading them because steeper price cuts at the end of the holiday season would be more disastrous for the bottom line. If consumer demand holds up enough to avoid fire sales later on this month, then it will be better than expected because it means fewer bankruptcies in January.
The fact of the matter is that Black Friday sales showed a gain from last year. But, that has to be taken within the context of all of the declines that occurred earlier.
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Originally Posted by nightflier
Let's tell all our children to get D's and then we can celebrate when they pass with a C. Let's cut more social programs, that way we can throw more money at the few that are left. Let's boycott international treaties, then we can make a big deal when we sign an insignificant one. Let's send more troops to Iraq, so that the percentage of deaths & injuries seems lower. Let's set the presidential bar so low that even a black man named Hussein can get elected.
Oh please. Take these rants to another topic. And that last statement is rather offensive.
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