Byline: David Moin — with contributions from Mark Tosh, N.Y.; Joanna Ramey, Washington, and Michael Marlow, L.A.

NEW YORK — It was a busy three days before Christmas, but retailers needed a mind blower of a weekend to make up for business lost earlier this season.
They didn’t get it.
The stage is now set for another pressure-packed, promotional week, with retailers anxious about making December plans and hoping for few returns.
“This week is very important,” said Michael Gould, Bloomingdale’s chairman and chief executive officer. “We are running on target to make plan for the month, with the snow and all.”
Gould and other store executives interviewed Sunday and Monday said they had planned cautiously for the holidays, inventories aren’t bloated and that they are smoothly making the transition into resort and spring merchandise. Nevertheless, after one of the worst Christmas shopping seasons in 25 years, the markdown mania on fall goods is not about to abate. Business in Christmas c’94 also fell below expectations but was not nearly as depressed as this year. On Monday, stores geared up for the post-Christmas promotional push. Bloomingdale’s advertised 20 to 50 percent off, including an extra 10 percent off coats that had already been reduced 25 to 50 percent. Loehmann’s advertised 20 percent off goods already reduced 25 to 70 percent. Express had signs in its windows for post-Christmas reductions up to 60 percent off.
Saks Fifth Avenue is advertising 30 percent off already reduced apparel through New Year’s weekend, and Bergdorf Goodman will offer 40 to 70 percent off fall goods, though Stephen Elkin, Bergdorf’s chairman and ceo, said, “We’re not doing a ton of clearance. Our inventories are OK. We’re running the normal clearances after Christmas.”
Philip Miller, Saks chairman and ceo, said Saks is no more promotional than last year. One reason is that Saks has more Off-Fifth clearance centers operating to help keep inventories fresh at regular stores. Saks also stepped up its special shopping nights for preferred customers to accumulate rebates based on purchases; that lifted the business in November and December. This year, weak apparel offerings, consumer apathy and last Tuesday’s blizzard converged to create what analysts and retail experts believe was the third- or fourth-worst Christmas selling season in a quarter of a century. They also said that with all the coupons, one-day sales and early-bird specials seen nationwide, it was the most intensely promotional season in memory.
“It’s really been quite amazing,” said Miller. “It has to have some impact on margins.”
J.C. Penney Co.’s sales were down 1 to 3 percent for the week before Christmas and the month to date, said Barger Tygart, president and chief operating officer, who blamed the weather for some of the shortfall.
“In the Northeast we had as many as 40 stores closed in large markets due to the weather,” he said. “You never make that up. Weather really crunched us out.”
Penney’s catalog finished the season ahead by 1 to 3 percent, he added. Women’s apparel was the toughest category at Penney’s, with sales down 7 to 9 percent. “Career clothing was off more than casual apparel,” Tygart noted. “Juniors denim and separates did OK. And we had low single digit gains in cosmetics and women’s accessories.”
Footwear, boys athletic apparel and sports logo apparel, especially Nike, were strong.
Despite a last-minute surge at all three of its divisions last week, Dayton Hudson Corp. said overall sales for the season were disappointing.
“We did see strong sales in the final week, but that strength is not likely enough to make up for the softness of the prior three weeks,” a DH spokeswoman said. “Overall, it’s clearly been a difficult season. Shoppers definitely waited. We did see sales develop later than we expected.”
The best categories at DH’s 63 Dayton’s, Hudson’s and Marshall Fields units were better sportswear, plus sizes, men’s casual and tabletop. Moderate sportswear, children’s wear, electronics and furniture were weak.
Target, the discount division, experienced weakness in women’s ready-to-wear, men’s softlines, electronics and jewelry. Consumables, health and beauty, music, movies and books and automotive were the best-sellers.
“I’ve talked to store managers who have told me that people are really spending conservatively,” the spokeswoman said. “For example, boom boxes under $100 are selling much better than anything over $100. So the lower price points in electronics seem to be doing well, but of course the category is mostly higher price points.”
For DH, the Midwest “continues to be the strongest region, although California seemed to show strength in week four,” the spokeswoman said. The boost in California was primarily due to Mervyn’s, while Target’s strength was the key in the Midwest.
When it’s all added up, the nation’s department and discount stores are seen reporting an average of 2 to 3 percent gains over last year. Many specialty chains could fall into negative territory, while a few higher end and luxury chains, performing well all year, are seen breaking into double-digit gains.
For example, Saks’ December sales through Saturday were 13 percent ahead in total, and 9 percent on a comparable-store basis, slightly behind plan. “The snow days took $3 million out of us, or about 1 1/2 points,” Miller said. “I think post Christmas will be an opportunity to recoup some lost business. We’ll come up with 10 percent store-for-store and be very pleased with that.”
However, one retailer said, “You really can’t make it up when you get hit with snow in the final week of Christmas season. It ends up being lost business.”
Down to the wire, the pattern of sales went unchanged. Sportswear, particularly moderate lines, and dresses continued to disappoint. High-end accessories, jewelry and cashmere continued to excel.
The worst Christmas in the last 25 years was in 1974, when nominal growth was 1.6 percent and inflation was 11.1 percent, putting real growth at minus 9.5 percent, according to Tactical Retail Monitor.
Another bad year was 1990, when general merchandise sales were off 0.59 percent, and inflation was 5.5 percent, yielding a real sales rate of minus 6.09 percent. In 1987, when the stock market crashed, Christmas sales hit 7.8 percent, with inflation at 3.7 percent. A healthy Christmas season for most retailers requires at least 5 to 6 percent sales gains, noted Isaac Lagnado, publisher of Tactical Retail Monitor. This year, with Christmas on Monday, consumers had one more day to shop than last year, when the holiday fell on a Sunday. Still, Sunday was “not optimal,” Lagnado said, since consumers seemed confused about store hours, thinking some stores were closing earlier than they did. “The clock stopped around 2 or 3 o’clock,” Lagnado said.
Some stores, including Barneys New York and Bergdorf’s, reported that last Saturday wasn’t terrific, either. Executives said business was bigger on the preceding Saturday. Bergdorf’s Elkin said each week in December got progressively stronger, adding that the women’s business did more in total dollars than a year ago and came “very close to the plan.” He explained that Bergdorf’s doesn’t bank on Christmas as much as most other stores and characterized September, when fall receipts are key, as just important as December. In the last few years, Bergdorf’s has strengthened accessories, home and the men’s store to capture more holiday shopping. He cited strong performances this season in Barry Kieselstein-Cord, Chanel, Gucci, Judith Leiber and furs, which seemed to be a strong gift item for the first time in a long time. In ready-to-wear, he cited Giorgio Armani, Escada, Chanel and Michael Kors.
Charles Bunstine, president of Barneys, said he was “really very, very happy,” with the season. “We didn’t have any problem with the snow in New York. We expected to get killed, but we didn’t see any flattening of sales — just a little depression.”
Bunstine said 60 percent of Barneys’ stock was delivered in the last 10 weeks, and therefore he expects a lot of gifts to be exchanged rather than returned, since the inventories are fresh. Business through December will be up 17 to 20 percent on a comp-store basis, he said. He cited sales of Giorgio Armani, Jil Sander and Prada as particularly strong. On the down side, “Instead of a promotional cold weather strategy, we left it regular price. We were happy because there wasn’t a sale tone in the store, but the penetration of total volume wasn’t huge.”
Bloomingdale’s Gould cited tabletop, trim, gourmet food and candies, cashmere, fashion accessories, watches and trend jewelry as key categories. The 59th Street flagship posted a mid-single-digit gain over the weekend, he said. Reportedly, increases at Bloomingdale’s units in Florida exceeded 10 percent gains.
In California, Gottschalk’s, based in Fresno, picked up last week with a strong Saturday and Sunday, compensating for weak sales early in the season. The store began the week 8 percent under last year’s comp-store sales but ended with a 2 percent comp-store increase for the season. Cold weather boosted sales of coats, sweaters and gloves. About 35,000 private label mid-weight zipper stadium jackets, were sold at $25. “I thought I would eat these jackets into spring, but all of a sudden, the cold weather came,” said Joe Levy, chairman and ceo. Career sportswear, sweaters and denim finished strong; coordinates and moderate sportswear didn’t.
At Theodore, a five-unit chain in Los Angeles, a busy weekend pushed sales 7 percent ahead of last year. Jewelry, cashmere and skiwear were standouts. Herb Fink, owner, said overall holiday sales were up 4 percent, partly because of the strong weekend.
“People came very late this year. They must of thought they had a lot of time.”
Bucking the trend, Sears, Roebuck & Co. had “the best sales week in our history” last week and expects to “outperform the retail industry” for December, said John Costello, senior executive vice president, marketing.
“It’s been a solid holiday for Sears across the store. Sales are on estimate and above year-ago results, but may not approach last year’s 8 percent increase for December.” Sears’ December sales are expected to top $3.5 billion, Costello said. Apparel met expectations, with strength in dresses, juniors, men’s casual and denim.
“With customers being time-starved this year, I think being able to offer one-stop shopping and the piece of mind that comes with our satisfaction-guaranteed policy made it easier to shop at Sears,” he added.
Other bestsellers at Sears were large screen TVs, computers, tools, cosmetics and fine jewelry. Tires, batteries and snow blowers did well, especially when the snow hit.
Carson Pirie Scott, based in Milwaukee, posted gains of 3 to 5 percent for the week, according to Ed Carroll, executive vice president of marketing.
“Women’s apparel outpaced the rest of the store,” said Carroll, citing special sizes, casual sweaters, twinsets, and CK Calvin Klein denim.
Other bestsellers were fashion jewelry, Olympic logo merchandise, Mickey Mouse and Dr. Seuss logo sportswear for juniors, and fragrances from Calvin Klein and EstAe Lauder.
Peter Marx, vice president of two-unit Saks Jandel in Chevy Chase, Md., said high-end business ended the Christmas season 15 percent ahead of last year. Fur sales, in particular, were more than 50 percent ahead of last November and December, he said.
At Potomac Mills, in Woodbridge, Va., 30 minutes south of Washington, mall sales were up 3 to 4 percent from last year. Apparel and accessory stores contributed most to the uptick, said mall marketing manager, Virginia Pancoe. The mall’s Off-Fifth and Nordstrom Rack reported sales increases “that were close to double-digit,” Pancoe said. She declined to specify figures.
“Across the board what we’re finding is the higher-end stores offering great value are doing very well,” Pancoe said. “The middle-of-the-road, lower-priced stores offering duplicated products are not.”

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