Growing Holiday Shopping Season May Hurt Retailers' Profits

As the unofficial start of the holiday shopping season arrives earlier and earlier, the door-buster sales are beginning to cut into retailers' bottom lines. Black Friday comes at a time when some of the biggest retailers such as J.C. Penney and Sears are hurting.

Copyright © 2013 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required.

DAVID GREENE, HOST:

No surprise. NPR's business news begins with Black Friday.

(SOUNDBITE OF MUSIC)

GREENE: Yes, this is the day when retailers begin to turn a profit for the year. But the deals and door-buster sales keep getting earlier and earlier each year. And that's actually beginning to cut into profits.

NPR's Sonari Glinton reports.

SONARI GLINTON, BYLINE: It's the new Thanksgiving tradition. Just after the pie is served, shoppers rush out to find the best deals. That's true here in Colorado Springs, where shoppers camped out to get deals at the local Target. Janine Reed and Barbara Losoya were among the hundreds.

JANINE REED: We got done about 5 o'clock. And I said, I need to change clothes - and they needed to leave. And they did. (Laughter) But it was my husband's family.

GLINTON: Meanwhile, Jim Pequignot was in line for six hours, hoping to get a crack at buying a 55-inch television for 250 bucks. Pequignot says he understands that he can get many of the same deals online.

JIM PEQUIGNOT: I can wait either 10 days to two weeks for that TV to show up, or I can get it tonight. And I chose to get it tonight. It's only six hours of standing in 25-degree weather, but that's all right, I'm a trouper. You going to watch that game tonight that's coming on? I am. I'll be watching the second half of that game.

GLINTON: Not only did more stores open on Thanksgiving, many opened early in the morning - often, to protests. This holiday season comes at a time when some of the biggest retailers - such as J.C. Penney and Sears - are hurting.

A quarter of annual sales for retailers is done in November and December. But is Black Friday as important as it used to be? Jack Kleinhenz is an economist with the National Federation of Retailers. He says probably not.

JACK KLEINHENZ: This holiday season has been expanding, and it's begun almost in October - and it actually even continues into January. But, you know, it will probably change the dynamics as we see stores being open on Thanksgiving Day.

MARSHAL COHEN: It's actually becoming almost like something that they are obligated to do.

GLINTON: Marshal Cohen is the chief retail analyst with the NPD Group. He says retailers are kind of between a rock and a hard place because expanding the season kind of ends up hurting them.

COHEN: In many cases, they're doing so much business that provides very little margin that they're really not generating enough business to really be worthwhile anymore. They've only created an even greater level of promotion rather than what used to be high volume based on profit margin.

GLINTON: Cohen says he believes that retailers and consumers are going to come to their senses, eventually.

Sonari Glinton, NPR News, Colorado Springs.

Copyright © 2013 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.