Warm weather trips up retailers but shoppers will see more fat deals

NEW YORK -- The unseasonably warm weather has left some people feeling cold about holiday shopping.

Rosemarie Nowicki, who lives in Berkeley Heights, N.J.

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, finally spent some of her holiday budget last weekend buying coats online for her family because she hated the thought of being stuck in a store with such mild temperatures outside.

"It's hard to get into the holiday spirit; I've been walking around in short-sleeve shirts and capri leggings," Nowicki says. "I was certainly not going to the mall."

Turns out, lots of shoppers feel the same way as temperatures in cities across the country, including New York and Philadelphia, near record levels for December. The balmy weather hasn't done anything to entice Americans to venture out and shop, which has hurt sales at stores that depend on the holiday season for up to 40 per cent of their annual revenue.

Planalytics, a weather forecasting firm for retailers, estimates so far this season mall-based clothing stores have lost $343 million in sales compared with last year. That's the largest weather-related loss since 1998 when a devastating ice storm hit parts of the Northeast.

Sales of cold-weather items have been particularly icy. Sales of women's boots in New York, for instance, are down 24 per cent for the first half of December, according to Planalytics. And First Data, which analyzes payments at stores and online, said fur sales fell 20 per cent from Oct. 31 through Monday.

"Winter didn't happen and so the clothes, the scarves are not selling," said Ron Friedman, head of the retail and consumer products group at accounting firm Marcum LLP. As a result, he says shoppers will see discounts of 75 per cent in after Christmas.

The fair-weathered shopping challenge underscores how U.S. consumers, still affected by the Great Recession, remain strategic in their buying patterns. It's a habit they picked up during the economic downturn that's remained ever since.

Many shoppers only buy what they can wear, so it stands to reason that they're not buying coats, boots and hats this year. And since cold-weather items are also hot gifts during the holiday shopping season, many of those items are left on store shelves.

The National Retail Federation, nation's largest retail group, is sticking by its prediction earlier in the season that sales in November and December will rise 3.7 per cent to $630.5 billion. Still, the unusually warm weather is a concern.

Marc Kaufman, CEO of the upscale furrier that operates one store in New York City but mostly sells online, says business is down 5 per cent. The decline in its Northeast business has been partially offset by its online operations. But Kaufman figures if the weather was colder, sales for the holiday season would be up 30 per cent.

"If it weren't for online, I would be in severe trouble," he said.

The cold reception by shoppers is forcing retailers to be creative to try to lure them into stores.

Some stores are offering bigger discounts than they ordinarily would. Macy's, for example, is advertising 70 per cent off some men's sweaters and 75 per cent off children's outerwear this weekend, while Kohl's is slashing prices of puffy jackets to $39.99 from the original $100.

Sears is relocating its grills to the front part of its outdoor living sections in the Northeast, where it's been unseasonable warm.

And Overstock.com is featuring resort wear like swimsuits on its website before Christmas. Overstock.com, which doesn't own the inventory, said it's directing shoppers to what they need now.

"When there's no snow, we don't advertise coats," said Amy Browning, merchandise manager of Overstock.com.



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