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American Morning

Retailers Came Out of Holiday Shopping Season Breathing Heavy Sigh of Relief

Aired January 03, 2002 - 07:50   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LEON HARRIS, CNN ANCHOR: Retailers went into the holiday shopping season with a lot of worries, but they came out breathing a heavy sigh of relief. As CNN's Lisa Leiter reports the numbers weren't terrific, but they were better than expected.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Yes I got a good deal. I can't complain.

LISA LEITER, CNN CORRESPONDENT: Bargain hunting was the big theme this Christmas.

UNIDENTIFIED MALE: What else would you like?

LEITER: Now that Santa Claus has come and gone, early figures show the holiday shopping season while disappointing, could have been a lot worse.

GEORGE STACHMAN: It was a pretty poor holiday season unfortunately. In some respects the last week or so have been better, but at the end of the day it's been a pretty, pretty sluggish holiday selling season.

LEITER: An early reading from the National Retail Federation shows overall holiday sales rose about 2.7 percent, the weakest in a decade. But the latest reports also show weekly chain store sales did improve in the final week of December. The biggest winners, the nation's top discounters. Wal-Mart expects monthly sales to rise as much as six percent and Target sales top forecasts last month as well.

LEE CRUM: The whole September 11th thing, I think read as kind of an insecurity, you know, as far as people out there and as far as shopping and (UNINTELLIGIBLE), but we saw you know huge benefits from that. So we are pretty excited about the Christmas season so far - even after Christmas selling has been extremely strong.

LEITER: The discount price wars could cause problems for some. Prudential Security downgraded K-Mart stock and said it wouldn't rule out a Chapter 11 filing if sales continue to disappoint. As far as online retailers, they racked up a respectable holiday season, but did not do as well as some initially expected.

LISA ALLEN: Online retail will come in, I think, in the high single digits, increase over last year, which a lot of off-line retailers would give their eyeteeth for about now.

LEITER: Holiday discounts not only will cut into retailer's profits for the fourth quarter, but some say they may also prevent the rebound in sales retailers saw last January a month when clearance sales traditionally get underway.

Lisa Leiter, CNN Financial News, Chicago.

(END VIDEOTAPE)

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