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. Last Updated: 07/27/2016

U.S. Retailers Hit by Humdrum Holidays

NEW YORK -- Despite jammed stores and malls during the last weekend before Christmas, retailers remain anxious and uncertain after a desired sales bonanza failed to materialize.

Many storeowners disappointed by Americans' cautious buying are now looking with some desperation to last-minute shoppers and post-Christmas bargain hunters for some relief in what has been a difficult holiday season.

"We are happy that we are holding ground, but we were really hoping for a higher increase" during the weekend, John Reilly, spokesman for K-B Toys Inc., said Sunday.

Analysts said other merchants had a similar experience.

"It was a solid weekend, but retailers needed a spectacular weekend," said C. Britt Beemer, chairman of America's Research Group. "It was what I expected, but not what I hoped."

Kurt Barnard, president of Barnard's Retail Trend Report, believes that sales at stores opened at least a year, known as same-store sales, could fall below his already reduced 2 percent forecast. Same-store sales are considered the best indicator of a retailer's health.

"The season is reflecting great spending caution and could be the weakest in a dozen years," Barnard said.

Retailers had a good start to the season with better-than-expected sales during the Thanksgiving weekend, but sales subsequently were surprisingly weak. Analysts say consumers have cut back on their spending because of worries about job security and the economy's uncertain recovery.

At the malls, shoppers were searching for the best price and retailers were accommodating them with two-for-one specials and other deep discounts.

At Sears, Roebuck and Co., gloves and other cold weather merchandise, as well as digital cameras and jewelry did well, according to Ted McDougal, a company spokesman.

Shoppers interviewed this weekend liked the lower prices.

John Crudo, from Brunswick, New York, said that one of his rewards for procrastinating was that he saved 50 percent on a $500 bracelet for his wife.

But the heavy markdowns might take a toll on retailers' earnings, an especially painful result, because many merchants hope to bring in half their annual profits during the holidays, according to Fred Crawford, executive vice president of Cap Gemini Ernst & Young.

Last week, a number of stores, including Electronics Boutique, Best Buy Co. Inc. and Barnes & Noble Inc. reduced their fourth-quarter earnings.

Even Wal-Mart Stores Inc., the world's largest retailer, is seeing sales at the low end of its projections for a 3 percent to 5 percent gain in December.

The National Retail Federation, an industry group, was holding on to its optimism, and to hopes that procrastinators will give stores a boost. The NRF estimated that 35 percent of consumers had not completed their shopping as of last Monday.

"The season isn't over. We are now in the most important days," said Karen MacDonald, a spokesman for the Michigan-based mall operator Taubman Centers Inc.