Area retailers pleased with Black Friday sales
But with prices so low, profits will be slim
Buffalo Niagara retailers are taking a cautious breath after one of the most anxiously anticipated Black Friday shopping weekends in recent memory.
“It was a good day for us,” said Macy’s Boulevard Mall Manager Jason Braden. “Sales were strong — stronger than last year, which is a good thing.”
After months of doomsday predictions and stalled sales, a national 3 percent increase in Black Friday revenue was a welcome boost to retailers braced for the worst. Though no hard local sales numbers were available, local retailers said they were pleased with the weekend’s results.
John Ecklund, Walden Galleria assistant general manager, said local trends did more than merely meet low expectations.
He said several stores have reported higher sales than last year, noting some sales were “well above” last year’s high water mark.
Traffic increased 20 percent at the Fashion Outlets of Niagara Falls, with Black Friday sales “definitely up” from last year, according to Outlets spokeswoman Julie Clark.
Eastern Hills Mall General Manager Judy Sirianni reported its best Black Friday sales in “many, many years.”
But as the dust begins to settle, experts warn that retailers are not out of the woods yet — not even close.
Arun Jain, professor of marketing at the University at Buffalo School of Management, said favorable-looking numbers can mean little in the grand scheme of things.
“Everybody is talking about revenue, but where is the margin? That’s the issue,” Jain said.
Jain said terrified retailers are taking a huge hit on profits just to keep their heads above water. It’s a strategy that may keep stores alive but will do nothing to kick-start the economy over the long run.
“It’s going to be a bloodbath. Retailers are literally giving away the store just to capture market share from competitors and hang on,” he said. “I don’t see how they could come out ahead.”
Even deep-discounter Wal- Mart, whose cost structure has allowed it to sell inexpensive goods and still come out ahead, will not be “laughing all the way to the bank,” Jain said. While they will fare better than others, they will not make “oodles of profit” because they, too have cut margins.
While Black Friday is not a predictor of holiday sales, it does set the pace for the season.
A larger-than-expected post- Thanksgiving shopping crowd does not mean gloomy economic predictions were off base. What it could mean, said Sirianni at Eastern Hills Mall, was that a legion of newly minted bargain hunters were taking advantage of what they expected to be the most advantageous day to shop.
And with three shopping weeks left until Christmas, retailers said they will continue to roll out great deals and coupons to lure customers through the doors.
Sitting inventory hints at an increase in “bundle” sales, where prices stay the same but merchandise is offered “buy one, get one free.” Prices are poised to drop, too, local retailers said, now that consumers have proven their ability to wait out a deal.
“You have to decide whether you want to sell four things at full price or eight things at a discount,” said Joe Eckl, manager at Laux Sporting Goods. “You’ve got to do what you’ve got to do in this economy.”
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