Major U.S. retailers found Christmas the season to be jolly as consumers staged a buying burst that made store managers pleasantly surprised and hopeful that the nearly 2-year-old slump is ending.
"It was a pretty solid kind of sales performance," said Michael Wellman, vice president of marketing for K mart Corp. "We're pleased."Wall Street analysts estimated overall retail sales were up around 6 percent from Christmas 1987, with some segments of the industry recording even stronger gains.
Edward Johnson, an analyst with Prescott Ball & Turben, said the season was "in the high range of what the stores have been looking for."
The Christmas season is crucial for retailers because they make about half their annual profits during the period. Consumer activity such as retail sales accounts for about two-thirds of the gross national product, the broadest measure of the nation's economic activity.
Monroe H. Greenstein, an analyst with Bear, Stearns & Co. Inc., said the general tone of business was better than last year, when faltering sales forced retailers to slash prices. But this season there were fewer markdowns, Greenstein said.
Some retailers said they came through the season well, even though business was erratic.
"I don't think we expected it to be quite as see-saw as it was," said Wellman.
Wellman said K mart had a robust start right after Thanksgiving, but sales slackened and then picked up before surging in the final days of the season.
Another satisfied retailer was Tiffany & Co., the luxury jeweler, which reported its sales were up 24 percent from Nov. 1 through Christmas Day. The company's performance indicated high-ticket gifts sold well.
The retailers and analysts had conservative expectations going into the season because of the retail slump. Debt-saddled consumers have put many purchases on hold as they pay for services and necessities.
There were signs in recent months that sales might pick up, but retailers were taking no chances. They stocked their shelves carefully and didn't expect too much from the season.