Gift shoppers: Bag your best bargains early

As merchants stock less holiday merchandise, retail experts say procrastinators will either miss the best deals or products when they are finally ready to buy.

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By Parija B. Kavilanz, CNNMoney.com senior writer

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NEW YORK (CNNMoney.com) -- If you expect holiday bargains to get better as Christmas Eve draws near, you may be disappointed this year.

Retailers aren't as panicked about the upcoming holiday shopping season as they were last year.

That's bad news for shoppers because this could mean leaner sales, sparsely stocked stores and a run on the best deals for such sought-after items as smartphones, thigh-high boots, side-sling bags and ruffled cardigans.

With this scenario in mind, retail experts said their No. 1 tip for gift shoppers this year is grab what you want, when you see it.

"Merchants got burned badly last year when they were left with a lot of unsold merchandise after Christmas," said George Whalin, retail expert and president and CEO of Retail Management Consultants.

And since the past 10 months have been a sales nightmare for most merchants, amid an ongoing spending slump, sellers have up to 30% less merchandise stocked for the year-end gift-buying season that unofficially kicks off the day after Thanksgiving.

The November-December period is critical for sellers because it can account for as much as 50% or more of retailers' profits and sales for the full year.

Without the fear of being overstocked, merchants will also be less promotional with holiday goods versus last year in order to preserve their profits.

So don't expect big red sales signs screaming 50%, 60% or even 70% off right after Black Friday, analysts said.

"This year, the magic point for retailers will probably be 40% off and maybe 50% and another 20% off on clearance items much later in the season," said Marshal Cohen, chief retail analyst with market research firm NPD Group.

Will there be a holiday rush?

With the nation's unemployment rate at its highest level in more than two decades, no one expects Americans to whip up an uninhibited shopping frenzy over holiday gifts.

The National Retail Federation, the industry's largest trade group, expects holiday sales will decline 1% this year, although that dip would be an improvement over 2008's 3.4% drop for the season.

Still, some industry watchers say the recent pick-up in monthly sales seen at chain stores, coupled with more than a year of pent-up demand among consumers, could make it hard for many to resist "splurging" a little bit on the seasonal sales that are coming up.

If that happens, it could bring a run on some merchandise in the coming weeks, said Craig Johnson, president of retail consulting group Customer Growth Partners.

If some sellers are caught with product shortfalls, Johnson said they could even sneak in spring merchandise by December to fill any vacant spots in their stores.

"This is not a totally new phenomenon," he said. "We've heard rumors that some teen-focused retailers may bring in spring products by mid-December."

Johnson also gave examples of what he expects to be this year's hot holiday sellers. "Everyone already has a big flatscreen TV," said Johnson, "E-readers, whether it's [Amazon's (AMZN, Fortune 500)] Kindle or Barnes & Noble's Nook e-reader that's coming out later this year, are going to be hot."

Smartphones and gaming consoles will be top purchases as well, he said. In clothing and accessories, women's embellished leggings, boots, sweater vests and side-sling handbags will be in big demand, Johnson said.

NPD's Cohen, has a somewhat different perspective.

"If consumers can't find something in one store, they will look elsewhere, or online," Cohen said.

Regarding introducing spring products during the winter sales events, Cohen said that it could actually be a smart move by retailers to infuse some newness and freshness into the stores.

"You want to keep consumers coming back to the store. It's a good way to get holiday gift card [recipients] to come back, too," he said.

Countering Johnson's predications of holiday hot sellers, Cohen thinks many consumers will shop for traditional gifts.

"It's back to tradition this year. Sweaters, perfumes, small leather items, music. movies, board games and gift cards," he said.

The single biggest holiday shopping trend, however, will be "fewer people on the shopping list," said Cohen. 'For those on the bottom of the list, people will be baking cookies."

Talkback: Are you giving more or fewer holiday gifts, and how much do you plan to spend per gift this year versus last year? E-mail your response to realstories@cnnmoney.com and you could be part of an upcoming article. For the CNNMoney.com Comment Policy, click here.  To top of page

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