- The Washington Times - Wednesday, December 27, 2000

A last-minute surge in spending boosted holiday sales 3.1 percent this year, but the increase was not enough to rescue retailers from a mediocre season.

The one bright spot could be found on the Internet, where holiday spending levels rose more than 100 percent since 1999, according to one study.

Between $325 billion and $350 billion was spent during the 31-day holiday shopping season that began Nov. 24, according to TeleCheck Services Inc., a Houston-based check-acceptance company that tracks consumer spending.

Sales increased 2.4 percent in the period that began Nov. 24 and ended Dec. 17, compared with the same period last year. But a shopping surge the week before Christmas boosted sales, TeleCheck said.

William Ford, TeleCheck's senior economist, said rising oil prices and a slumping stock market depressed spending levels.

He said consumers also put off shopping until the last minute because Christmas fell on Monday for the first time since 1995.

"They procrastinated because they felt they had an extra weekend before the holiday," Mr. Ford said.

The busiest shopping days were Dec. 23, Dec. 22, Dec. 16, Dec. 21 and Nov. 24, the day after Thanksgiving, Mr. Ford said.

Retailers in the District of Columbia experienced a 4.4 percent sales increase, the second-highest in the nation, behind Hawaii's 5.1 percent jump from 1999 to 2000.

Maryland stores saw a 3 percent increase, and Virginia retailers experienced a 2.9 percent increase compared with last year's figures.

The average check in the District was for $123.71, among the largest in the nation and higher than the national average of $91.35. Checks are used to pay for one-third of all holiday purchases and can be used to measure consumer spending, Mr. Ford said. Credit cards and check cards account for about one-fourth of the spending; the remainder is primarily cash.

In 1999, holiday sales increased 6.2 percent from 1998's figures, TeleCheck said. Most major retailers had expected a similar increase this year and were forced to cut December sales forecasts yesterday.

Wal-Mart Stores Inc.'s sales will miss its forecasts of a 3 percent to 5 percent gain, spokesman Tom Williams said. Federated Department Stores Inc., the owner of Macy's and Bloomingdale's, said sales will rise 1 percent to 2 percent, less than its 3 percent target.

Analysts said they may cut more estimates as stores hold clearance sales this week.

"There's still some room for estimates to fall a bit more," said Richard Church, an analyst for Salomon Smith Barney Holdings Inc., a New York-based investment house.

Internet-based retailers accounted for about 10 percent of total purchases, according to analysts.

On-line shoppers spent $8.7 billion this holiday season, a 108 percent jump from the $4.2 billion dollars spent on line during the same period in 1999, according to a study by New York investment house Goldman Sachs Group Inc. and technology research firm PC Data.

The study tracked Web purchases made from the beginning of November to Dec. 17.

Yahoo Inc. said holiday orders placed through its U.S. shopping sites almost doubled this year, while disappointing sales at Kmart Corp.'s BlueLight.com forced the company to slash prices by as much as 70 percent.

Mr. Ford said after-Christmas sales will probably be stronger this year than in 1999.

Economic troubles probably kept some consumers from spending much during the holidays, so some may wait for the deep discounts that retailers typically make after Christmas, Mr. Ford said.

The Potomac Mills shopping mall in Prince William County expected 100,000 visitors yesterday, a slight increase from its usual Dec. 26 traffic, according to spokeswoman Michelle Ralston.

The mall received 110,000 visitors Nov. 24, Ms. Ralston said.

"Consumers this year want to stretch their dollar as much as they can," she said.

Carolyn Creswell, a Harrisonburg, Va., resident, brought her two sons to the mall to spend money she gave them for Christmas. The boys said they were eager to find sales on clothing and shoes.

Pam Gauche, a Woodbridge, Va., resident, came to Potomac Mills to exchange gifts she received for Christmas and to have lunch with friends from out of town. But she abandoned her plan to make exchanges when she saw the crowd at the mall.

"It was ludicrous for me to think I'd be able to exchange anything today… . I know better," she said.

• This article is based in part on wire service reports.

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