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Shoppers fill stores
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November 26, 2001: 3:05 p.m. ET
Data show customers were out seeking and finding bargains.
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NEW YORK (CNN/Money) - Shoppers hit the malls and other stores over the holiday weekend, apparently looking for and finding bargains -- a fact that could limit retailers' already shaky profit outlook.
TeleCheck said its survey of check purchases at 27,000 locations nationwide show that sales were up 2.4 percent on Friday from the purchases at the same locations last year. But the same data show the average purchase by check was $73.64, which is 4.6 percent less than $77.18 spent a year earlier.
"There are more people shopping, but they're spending less," said William Ford, senior economic adviser at TeleCheck Services.
A strong start to the holiday shopping season does not necessarily equate to a strong season overall, said Michael Niemira, vice president and senior economist with the Bank of Tokyo-Mitsubishi, which closely tracks U.S. retail sales. Still, Ford said that the 2.4 percent gain is a good sign for retailers.
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Nadia Mitchell, right, and her mother Hamida Mitchell, stuff five bags filled with linens from Macy's department store into the trunk of a taxi cab Friday in New York. | |
Though the day after Thanksgiving is no longer the busiest shopping day of the year, it is still among the busiest. The Saturday before Christmas is now the busiest day. The early Thanksgiving means this year's holiday shopping season will be longer than normal, which could also help sales.
Another survey found 8 million fewer shoppers visited the nation's malls on Friday and Saturday than a year earlier, a drop of about 7.5 percent, according to Chicago-based RCT Systems Inc., which tracks mall traffic at 200 malls and 800 department stores.
"I think the traffic looked good. Most retailers are saying for that day or that weekend that they were on-plan, with on-plan being they have lowered their expectations, but it's looking like they're going to meet them," said Sarah Scheuer, a spokeswoman for the National Retail Federation, a major industry trade group. "I think we're going to see it ramp back up as we get closer and closer."
Scheuer also said many consumers appear to be making a conscious patriotic decision to spend this season, in light of the Sept. 11 terrorist attacks, as a means of shoring up the economy.
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CNN's Brian Palmer takes a look at the holiday shopping season's first weekend.
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"Some consumers are making the decision they're going to spend this year anyway," she said.
A more bullish shopping projection came from Treasury Secretary Paul O'Neill, who told CNN's Late Edition on Sunday that sales were up 4 percent from a year earlier. He said a strong shopping season could be a sign of an earlier-than-expected recovery for the U.S. economy.
"I think our economy is coming back," O'Neill said.
TeleCheck projects that sales at stores open at least a year, a closely watched retail measure known as same-store sales, should be up 2 percent this year. Good weather and a desire for normalcy were among the factors bringing shoppers out Friday, according to TeleCheck.
Click here for CNN/Money special report on holiday shopping
"People in this country want to return to a feeling of normalcy," said Ira Silver, TeleCheck's Senior Retail Adviser. "Visiting family and shopping the malls the day after Thanksgiving help to bolster that feeling."
The results were good at discount chain Wal-Mart Stores Inc. (WMT: Research, Estimates), the world's largest retailer, which posted record single-day sales of $1.25 billion on Friday. The Bentonville, Ark.-based company said home electronics, toys and small appliances were among top sellers.
Other retailers have said that toys related to the Harry Potter books and movie and Microsoft Corp.'s (MSFT: Research, Estimates) Xbox video-game console are particularly hot sellers.
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Wal-Mart and some other discount chains have reported improved same-store sales since the Sept. 11 terrorist attack, while some other retail chains, particularly apparel retailers, have seen same-store sales fall.
"So far, this has turned out to be the year's great bargain hunt," said Kurt Barnard, president of industry publication Barnard's Retail Trend Report. "Consumers are hunting for bargains and finding them.
Though steep discounts are helping to drive sales, they are also likely to dampen retailers' bottom lines in the fourth quarter.
"I think we're generally going to see people meeting expectations this year," Jefferey Klinefelter, senior retail analyst at US Bancorp Piper Jaffray told CNNfn's Before Hours Monday. "I think we're in good shape in terms of investing, I just think it's going to be very volatile in the next couple of weeks until the anxiety dissipates a little bit and we get more visibility for the back-end loaded month of December." 
From staff and wire reports
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