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Wed, Nov 26, 2003 - Page 12 News List

US gears up for `Black Friday' shopping frenzy

MAKE-OR-BREAK For many retailers, sales on the day after Thanksgiving determine whether they end the year's books in the red or safely in the black

AFP , WASHINGTON

Americans are gearing up this week for possibly the busiest holiday shopping frenzy in four years, starting on "Black Friday" -- a make-or-break date for many retailers.

Black Friday, which falls this year on Nov. 28, the first shopping day after Thanksgiving, is so called because the sheer volume of sales can pull many retailers' annual accounts out of the red.

One-third of all Americans will go shopping for gifts on that day, armed with an average budget for the season of US$1,086, according to a poll released by American Express.

"The day after Thanksgiving is a highlight for both retailers and consumers," said American Express retail industries vice president John Theiss.

"While many shoppers are drawn to the energy of the stores and the holiday kickoff, most report that they will be out to get the best deals and bargains," he said.

Wachovia Corp forecast holiday sales from Black Friday onwards would surge 7.0 percent this season, compared with gains of 4.7 percent last year and 2.9 percent in 2001.

"Tax cuts and an improving economy are fueling what looks to be the strongest holiday shopping season since 1999," said Wachovia senior economist Mark Vitner.

Most surveys were tipping little change in household spending in the season, expected to be an average of US$675, Vitner said.

"But what consumers actually do is far more important than what they say they intend to do," he said.

"We expect actual spending to be surprisingly strong this year as consumers find plenty of bargains to chose from."

Prices for many popular toys and electronic toys had tumbled, he said, with the consumer price index for goods excluding food and energy declining 2.4 percent over the past year.

"That means this year's 7.0 percent gain in retail sales will actually translate into a 9.4 percent rise in sales volume."

Consumers' wallets were thicker this year, he said, with after-tax take-home pay up 3.2 percent over the past year.

"Moreover, lower interest rates have helped many households reduce their monthly mortgage payments, freeing up more income for discretionary purposes," Vitner said.

Wal-Mart, the world's biggest retailer, said it expected sales for the whole of November to be up by between three and five percent.

"Stores are set and ready for Thanksgiving," it said in a weekly report on Monday.

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