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RETAILING: Santa the Supersalesman

4 minute read
TIME

“They’re not going to shoot Santa Claus,” said an official of Gump’s department store in San Francisco in the midst of the Christmas buying rush. And indeed, even before the gift wrapping had been torn from millions of presents, it was apparent that Christmas sales across the nation had exceeded all but the rosiest predictions. The surge might give the economic recovery some new momentum.

At Thanksgiving, most retailers were talking about a 10% gain in dollar sales over the dreadful 1974 Yuletide showing. Instead, it is now clear that the gain was at least 12%, and possibly as high as 14% or 15%. Since consumer prices were about 7% higher at the start of the season than a year earlier, that translates into a 5% to 8% increase, even discounted for inflation.

All kinds of stores shared in the splurge. Among department stores, Federated, the nation’s largest department-store chain, figured that its sales ran 10% to 11% ahead of last year’s Christmas season. Bloomingdale’s, its showpiece division (TIME cover, Dec. 1), posted a 20% gain. Rich’s Inc. in Atlanta lifted sales 25% above the 1974 Christmas season and Detroit’s J.L. Hudson Co. gained perhaps 10% over even 1973, the banner year for Christmas sales.

Classic Handbags. Discounters did well. S.S. Kresge, which logged a 21% gain in sales for the first three quarters of 1975, expects to show a jump of nearly 30% for the full year after its Christmas results are figured in. At the other end of the retail spectrum: “We are having the best Christmas we have ever had,” said Nicola Minelli, manager of a jampacked Gucci branch in Beverly Hills. Minelli was hard pressed to meet the demand for $6,000 “classic” handbags (lizard with 18-carat gold fittings and chain). At Manhattan’s Tiffany & Co. consumers snatched up nine $3,800 calculator watches and about 2% miles of “diamonds by the yard.” Chairman Walter Hoving reported a 38% sales leap over December 1974.

Even in stores that cater to a less well-heeled clientele, retailers discovered that big-ticket items such as furs (TIME, Dec. 29) and electronic digital watches were selling briskly. Consumers, it seemed, were interested in high-quality goods and were less inclined than they once were to hunt for bargains. This year’s most popular items included sportswear, fashion accessories and cosmetics, along with newfangled small appliances like peanut-butter makers and electric hot-dog grillers and such voguish gimmicks as mood rings and “pet rocks.” Only “intimate apparel” clearly fell shy of merchants’ expectations.

What brought about the surge? Retailers unanimously spoke of “the return of consumer confidence,” but few could explain just what made shoppers so cheerful at a time of continued high unemployment and inflation. “The American public has always had a short attention span,” ventured Martin Jacobs of the Lipman Wolfe & Co. department-store chain in Oregon. “They see a recession, are told to conserve, and do. But then, when things don’t improve all that much, they go back to their old buying habits.” Julian Seeherman, a senior vice president of Abraham & Straus in Brooklyn thinks that with the economy slowly recovering, “people are less concerned about security and are willing to spend for what they think is right.”

Some of the sales gain—perhaps 1%—probably came about because this year there were 23 shopping days between Thanksgiving and Christmas, or one day more than last year. During early December the weather was unseasonably mild in many parts of the country; that encouraged shopping expeditions, and even snows just before Christmas did not wipe out the benefit. Sales were also boosted by Sunday store openings in various cities—some of them, as in Warwick, R.I., amounting to mass disobedience of local “blue laws.”

Whatever the reason for the strong Christmas sales performance, it can only please economists, who have been counting on consumer buying to keep the recovery rolling, and who were mildly worried by a flattening out of retail sales last fall after a strong spurt in spring and early summer. It is true that sales comparisons are distorted by the fact that the 1974 Christmas season was a disaster; discounted for inflation, this year’s holiday volume may not have matched and at any rate did not exceed 1973’s. All the same, many retailers will be stocking up for spring much more generously than last year, in anticipation of continued consumer cheer. But they will also be cautious and realistic, remembering too well what it means to be caught with oversupplies. Says Joseph Ellis, a retailing analyst at the investment firm of Goldman, Sachs & Co.: “We are not in an atmosphere of retail profligacy—not yet.” Meanwhile, in the weeks before the reordered merchandise comes in, many shoppers who waited until after Christmas to look for bargains may find shelves picked clean by the enthusiasm of the early buyers.

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