Retail executives less optimistic about Black Friday in survey

Posted 11/16/11

NEW YORK - Retailers’ chief marketing officers are less optimistic about sales growth on Black Friday than they were a year earlier as increasing competition prompts stores to boost discounts, according to a survey by BDO USA.

Purchases on Nov. 25, the day after the Thanksgiving holiday, may rise 1.6 percent, the average estimate of 100 executives in BDO’s survey conducted last month. That compares with an average projection of a 3.8 percent increase in the survey last year.

“It’s not a home run by any means, but it’s positive growth,” Ted Vaughan, a partner at BDO’s retail and consumer practice in Dallas, said in an interview. Black Friday’s importance has diminished as retailers start advertising holiday deals earlier, he said.

Black Friday serves as the unofficial start to the holiday shopping season when retailers lure shoppers to stores with discounts and giveaways. Sales on the day rose 0.3 percent last year, according to Chicago-based ShopperTrak. Sales for the weekend after Thanksgiving gained 6.4 percent last year, according to the National Retail Federation.

Sales for the entire holiday shopping season may increase 2.9 percent, according to the BDO survey. That would be slower than the 5.2 percent gain a year earlier that was reported by the Washington-based NRF.

Discounts will also increase and put more pressure on retailers’ profit margins, Vaughan said. About 78 percent of respondents in the BDO survey expected a gain in promotions, up from 64 percent a year ago. The survey was conducted in October and included public and private U.S. retailers of various sizes, including 12 in the top 100 by annual revenue.

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