Crowds of shoppers may have thin wallets

Black Friday has the traditional crowds, but there are signs of restrained spending

It looked like any other Black Friday -- stores opening before dawn, throngs of bargain-hunters bundled in blankets and sweaters.

But this year, the day after Thanksgiving was more than the typical display of consumerism. It was a window into the minds of shoppers facing perhaps the most severe economic pain in a generation.

Yes, thousands of Triangle consumers poured into stores to snatch up $8 jeans, $400 flat-panel TVs and $100 GPS navigation systems as retailers such as Wal-Mart and Best Buy tried to jumpstart holiday spending.

And area shopping centers reported steady traffic -- by late morning Friday it took as long as 20 minutes to snag a parking space at Raleigh's Crabtree Valley Mall -- spurring optimism that retail sales this holiday season could exceed the most dismal forecasts.

But the volume of shoppers was not necessarily a fair reflection of their mood.

While people turned out to pick up the biggest bargains, many were unwilling to buy much else. They emphasized needs over wants in purchase decisions and, in interviews, most made clear they intend to spend less this year.

"I wanted a 32-inch TV," said Sherrillan Atkinson, 27, of Newton Grove, while taking a break on a bench at Crabtree Valley Mall with her mother and 2-year-old son, Zayden. Earlier in the day, Atkinson checked out the selection at Wal-Mart, where "they had good prices," she said. "But no way I'm going to get that now."

Even shoppers who aren't scaling back want to stretch their dollars.

"We're probably buying more things on sale," said Ann Collins, a physician, who was shopping at North Hills in Raleigh with her husband, Jeff, director of marketing at Glaxo-SmithKline. Why pay full price, they figured, when stores are slashing prices on most items?

Tough times in retail

Retailers don't have much choice. They face the stiffest head winds in years as they try to spur sales at a critical time for their operations.

Traditionally, the holiday season accounts for 25 percent to 40 percent of stores' annual sales. The Friday after Thanksgiving was dubbed "Black Friday" in the first place because, historically, it was the day that retailers turned profitable for the year.

This year, holiday sales are projected to grow 2.2 percent, according to the National Retail Federation, the most sluggish growth since 2002.

At least one analyst, Britt Beemer, founder of America's Research Group in Charleston, S.C., says sales during the period could actually decline. And he predicts more retailer bankruptcies in the first six months of 2009 than in the past five years. "Everything is at stake this year," he said.

The economy is in one of the worst spots in decades, with world financial markets struggling to resolve a credit crunch, the U.S. housing industry in shambles and joblessness rising. It has all taken a toll on consumers, who are growing ever more cautious as the troubles linger.

"We're all doing more practical gifts this year," said Scott Preston who, with his wife, Laurie, and their 20-year-old daughter, Marikate, was among the few shoppers at Durham's Streets at Southpoint mall before 6 a.m. He plans to buy cooking supplies for his wife instead of jewelry.

That's because the family is on a tighter budget than usual. They moved to Moncure a year ago and haven't been able to sell their old house in Plattsburgh, N.Y. With two mortgage payments every month, "the expendable cash just isn't there," Scott Preston said.

Tina Davisson, 50, of Yorktown, Va., and Rebecca Hicks, 56, of Raleigh shared a similar sentiment. Shopping on Black Friday is a tradition for the cousins, and they spent Friday morning in Wal-Mart on New Hope Church Road in Raleigh.

Hicks wanted gifts that family members "are really going to need and use so I don't feel bad about spending money."

At the top of the shopping list: A GPS system for $97.

Analysts expect retailers to continue discounting merchandise this weekend and in the coming weeks to salvage the holiday season. The Galatea boutique in Raleigh, for instance, sent an e-mail to regular customers promoting a "Holiday Haggling Weekend."

"We have decided to listen to all the talk shows and shopping experts and offer to our customers a chance of haggling for a better price on anything in the store!!" the e-mail read. "So, want a better price? This weekend.....All you have to do is ASK!!"

Some reason to hope

Figures on Black Friday sales won't be available until the end of the weekend. But there is evidence the promotions ignited some momentum.

Carl and Celia Inman went to Best Buy on Glenwood Avenue in Raleigh on Friday morning to buy a Garmin navigation system on sale for $350, a $150 discount. It was the first time they had ventured out on a Black Friday and, while at the store, also picked up a second GPS system as a gift and a universal remote control.

They were impressed by the bargains. "I wouldn't have come out today unless it was a really good deal," Celia Inman said.

Elsewhere in the store, other changes in consumer behavior were on display. Shoppers huddled over bins of movies priced at $4.99 each while a nearby pallet of 32-inch flat-panel televisions advertised as a $400 doorbuster still had 30 units -- five hours after the store opened.