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Entries in Retailers (17)

Sunday
Nov182012

Black Friday: Retailers, Shoppers Preparing for Big Day

ABC News(NEW YORK) -- Retailers are preparing for a stampede of shoppers on Black Friday, some of whom have already begun camping outside of stores, eager to get the best deals first.

Nearly one in four Americans, 86 million total, hit the stores on Black Friday last year, according to the National Retail Federation.

At one retailer, ABC News witnessed a mock Black Friday scenario, where a steady line of people banged their shopping carts through the door.

There’s good reason for the training. Some shoppers in Wisconsin are already camped out, ready to be the first people through the door when the Black Friday sales begin.

“Our time is almost getting paid back just by the savings,” one shopper said.

But not everyone is cheerful about the big day. Employees of some big box stores are unhappy their stores are opening on a Thursday for shopping, causing them to miss spending Thanksgiving with their families.

“We’re just demanding respect,” said Rosetta Brown, a Wal-Mart employee.

Target announced on Monday that it is opening some stores on Thanksgiving at 9 p.m. for its Black Friday sale, which in the past began the day after Thanksgiving.

Walmart will be opening its doors at 8 p.m. Sears will also open at 8 p.m. on Thanksgiving, moved up from 4 a.m. on Black Friday last year. Kmart will be open Thanksgiving Day 6 a.m. to 4 p.m., then it will close and reopen 8 p.m. to 3 a.m. Macy’s, Kohl’s and Best Buy open at midnight.

Copyright 2012 ABC News Radio

Wednesday
Jul182012

Credit Card Settlement May Not Help Consumers

Comstock/Thinkstock(NEW YORK) -- There's one thing plenty of people agree on about the new $7.25 billion settlement reached between big banks and retailers on credit card swipe fees: They don't like it.

"People on both sides of the issue are disappointed," says Anisha Sekar, VP of credit and debit products for NerdWallet, a website that helps consumers decide which credit card program is best for them.

Under the proposed deal -- which, if approved by a judge, would be the largest antitrust settlement in U.S. history -- merchants would be free to tell customers at checkout how much extra they're paying to use a given credit card than if they'd paid by cash.  Merchants also would have the option of imposing a surcharge on credit card purchases, which would help them recoup some of the hefty fees they pay to banks for credit card transactions.

The Wall Street Journal reports that for many retailers, those fees represent the third-biggest cost of doing business, right after rent and payroll.  A merchant's average fee, says the Journal, is 1.5 percent to 3 percent of each credit card transaction.

Defenders of the settlement reached last week say that under it, merchants' costs would be reduced; and further, that consumers would get more information to help them make better decisions about which card to use (or whether to use a card at all, and instead to pay cash).

Jeffrey Shinder, an attorney who represents some 145,000 convenience stores through the National Association of Convenience Stores (NAC), questions how much of a benefit consumers might get.

"If this goes through intact," he says, "you should ask yourself: Are merchants really going to surcharge?  I have my doubts."

Singling out credit card customers for a special charge would be "a PR nightmare in a tight economy," says Shinder.  Moreover, he says, state law in New York, California, Texas and seven other states prohibits such surcharges.  These states together, he says, account for 42 percent of transaction volume.  So, the settlement's terms "won't affect half the country."

One more twist: Merchants who accept American Express are precluded under their agreement with the card provider from imposing surcharges on Amex transactions.  And under the settlement's terms, merchants cannot favor one card over another.  Thus, any merchant who accepts Amex (and can't impose an Amex surcharge) can't impose a surcharge on for any other card, either.

"All of which is to say," says Shinder, "that I don't think there's going to be much impact.  It's why this is not a landmark settlement.  It's not going to benefit consumer welfare."

It could, however, be a huge pain in the neck for merchants.  Doug Kantor, counsel for NAC, foresees widespread confusion and frustration: "At the end of the day, merchants will throw up their hands and say, 'I can't do it,'" he predicts.

Copyright 2012 ABC News Radio

Friday
Jul132012

Settlement May Lead Some Consumers to Pay 'Swipe' Fees

iStockphoto/Thinkstock(NEW YORK) -- Payment networks Visa and MasterCard, as well as a number of large retailers, have agreed to a $7.25 billion settlement that may allow merchants to impose a surcharge on consumers for credit card transactions and end a seven-year battle over credit card swipe fees.

Under the current system, merchants pay interchange, or swipe, fees to Visa or MasterCard that go to banks. The settlement may give merchants the right to recover the cost of the swipe fees from consumers.

Kroger, Safeway and Payless Shoe Source settled with Visa, MasterCard and more than a dozen large banks after U.S. retailers filed a class-action lawsuit in 2005. The settlement must be approved by the Eastern District Court of New York.

The settlement will allow greater transparency to consumers, attorneys for the merchants said, because merchants are now permitted to tell them that there are fees associated with credit card use and they are recouping a portion of it. Or, they could tell the customers that it is cheaper to pay cash.

"Although we have strong defenses to all claims, a settlement avoids years of litigation and uncertainties that are inherent in such cases," said Noah Hanft, MasterCard's general counsel and chief franchise integrity officer. "We believe that today's settlements should resolve all issues with the merchant community."

Joseph W. Saunders, Visa Inc. chairman and CEO, said the company believes "settling this case is in the best interests of all parties."

Patrick J. Coughlin, senior trial counsel at Robbins Geller and one of the lawyers for the plaintiffs, said the new rules will allow merchants to "put pressure on the credit card networks to lower interchange or 'swipe' fees, which are the second- or third-highest cost of doing business for many retailers."

Bonny E. Sweeney, the firm's senior antitrust partner and its principal litigator in the case, said the settlement refunds billions of dollars to retailers that paid "artificially inflated interchange fees."

Frank Keating, president and CEO of the American Banking Association, said retailers were showing "little regard for consumers."

"Let's be clear: Retailers, not consumers, benefit from today's resolution," he said in a statement. "This settlement even provides merchants with the ability to impose 'checkout fees' on customers just for using credit cards. This type of behavior is nothing new for retailers."

Michael Kon, Morningstar senior analyst, said the settlement wasn't a surprise.

He said the right to allow a consumer surcharge for credit card transactions, the core of the legal battle, will affect smaller merchants or "mom-and-pop shops" mostly.

"Businesses like small grocery stores might be more flexible in surcharging for credit card transactions, though they risk losing clients," Kon said.

Kon doesn't expect the settlement to make a significant difference to consumers because large merchants, like Target and Walmart, may be hesitant to impose a surcharge on consumer transactions.

"Paying with credit cards is much more convenient for merchants and shoppers," Kon said. "It might be a bad strategy to penalize someone using the most convenient way to pay."

Many analysts note that merchants already take into account credit card swipe fees when they set their prices, whether you pay by credit card, cash or check.

"I don't see them rushing to give this surcharge to a group of shoppers who choose to pay with credit cards," Kon said.

Sweeney agreed that the settlement doesn't directly affect consumers because not all merchants will impose a surcharge on consumers.

"The helpful aspect of the settlement is [that], whether merchants charge customers or not to recover acceptance, having this tool will increase competition in the payment card market and eventually lower merchants' costs, which will eventually bring down prices for consumers," she said.

When asked the likelihood that merchants will pass on the possible lower costs to consumers, Sweeney said, "The U.S. retail market is very competitive, so it seems likely that merchants will pass the savings to customers."

Copyright 2012 ABC News Radio

Monday
Feb202012

Presidents Day's Lack Luster Sales

Brendon Thorne/Getty Images(NEW YORK) -- While Presidents Day's 2012 sales may feature deeper discounts than those of winter holiday promotions, they may not be as money-saving as those of last year's Presidents Day, according to Dealnews.com.

Jeff Contray, managing editor at Dealnews.com, said he has not seen discounts as strong as those of 2011. Last year most of the best sales launched the Friday before the holiday weekend. The most popular sale with readers last year, a 70 percent discount off lighting at Home Depot, launched the morning of Presidents Day.

This year, Old Navy already launched a promotion on Thursday for customers who purchase an adult pair of jeans for $19 between Feb. 16 and 29. Those customers will receive an Old Navy "Denim Price Lock" card, locking in the $19 sale price for up to three more pairs through May. From Feb. 23 to 29, customers can purchase kids' jeans and lock in the $12 price for their next three jeans purchases through May.

But overall, Contray said, the majority of Presidents Day sales were better last year.

For example, this year Aéropostale is offering a 50 percent discount on its website during its Presidents Day sale.

Although this seems a strong promotion, last year it offered 50 to 80 percent off for Presidents Day, and 50 to 70 percent off as recently as December, Contray said.

Similarly, Sears is offering up to 50 percent off select tools as part of its current Presidents Day sale. In 2011, the department store discounted tools by up to 65 percent.

Contray said he does not anticipate any wildly new promotions this year.

"Nearly every merchant that is running a Presidents Day sale this year offered one in previous years," Contray said.

Nevertheless, Presidents Day apparel sales may offer better deals than the recent Black Friday (the day after Thanksgiving) and Cyber Monday (three days after Thanksgiving), according to personalized online shopping site, Shop It To Me.

That site found that Presidents Day sales averaged 46.7 percent off apparel, shoes and accessories, outpacing those of Black Friday, which averaged up to 42.1 percent off, and Cyber Monday, which saw discounts of 41.1 percent.

Shop It To Me compiled Presidents Day sales and promotions from 40 retailers. Among the site’s vice president of marketing Tamra Feldman’s favorites, are those of J. Crew, which is offering a 20 percent discount off online orders of $150 or more, and Nordstrom, which is offering a 40 percent clearance on shoes, with free shipping and returns.

According to Shop It To Me's daily analysis of over 150 online retailers, February featured the best discounts on women's work suits compared with other months of the year. Because this winter has so far been unseasonably warm, Feldman said she is waiting to see if retailers will cut prices on those goods accordingly.

Copyright 2012 ABC News Radio

Monday
Dec192011

Experts: Boost in Holiday Shopping Indicates Increased Confidence

Tim Boyle/Getty Images(NEW YORK) -- With only five days left before Christmas, holiday shoppers are flooding the malls and local stores.

Nearly half of shoppers have not finished their Christmas shopping yet, according to a National Retail Federation survey, and the traditional biggest shopping days -- Black Friday, Cyber Monday, and Green Monday -- are all behind us.  The outlook seems to be that it's shaping to be a robust season for the economy.

Experts say this year consumers have the upper hand, as stores opened for extended hours and online vendors offered major discounts, some even with free shipping.

"The holiday season this year favors the consumer," Ellen Davis of the National Retail Federation told ABC News.  "Retailers have been very promotional, they know that the average shopper is still looking for a deal, spending on a budget, is very focused on small, discretionary items, basics and necessities."

On Thursday, the National Retail Federation revised its holiday sales forecast upwards from 2.8 percent -- which it had forecast in October -- to 3.8 percent, for a record $469.1 billion.  While this is still below the 5.2 percent for 2010, it's above average for the past decade, and holiday shopping isn't even over.

Experts say that despite the tough job market and the weak stock and house prices, Christmas is shaping up to be surprisingly strong for retailers.

"Households are spending with some gusto," said Mark Zandi, Chief Economist for Moody's Analytics.

Zandi told ABC News that increased confidence is helping both low and high income households finally start spending after long holding off.

"A solid Christmas buying season will set a very positive tone for the economy going into 2012," Zandi said.

Copyright 2011 ABC News Radio

Tuesday
Dec062011

Strong Holiday Shopping Numbers May Result in More Hiring

Sean Gallup/Getty Images(NEW YORK) -- With the holiday shopping season already in full swing, retailers are looking to add more employees to their work forces as the demand from shoppers continues to remain strong, a new survey finds.

As employment expert John Challenger with the jobs firm Challenger, Gray and Christmas notes, "Stronger than expected sales on both Black Friday and Cyber Monday resulted in a strong jump in hiring in November and that could push on into December."

Many retailers wait until they see how crowded their stores are and "then they add workers to accommodate those needs," he explains.

Last month, Challenger says retail hiring rose 27 percent compared to the same time last year.

Copyright 2011 ABC News Radio

Monday
Nov212011

Black Friday Hours Create Employee Revolt

GABRIEL BOUYS/AFP/Getty Images(NEW YORK) -- Black Friday is almost here, and the prospect of low-cost laptops and cheap HD TVs has some shoppers salivating.

Case in point: Tito Hernandez, who has been camping in a tent outside of a St. Petersburg, Fla., Best Buy store since last Monday. You read that right, last Monday, nearly two weeks before the big day.

"Definitely having fun here," Hernandez said with a smile. "Looking to save some money and get some good deals."

He'll have plenty of company. According to the National Retail Federation, 152 million Americans plan to shop on Black Friday or the Saturday and Sunday that follow. That's up from 138 million last year.

Retailers are ready for that spending spree. Holiday sales make up about a fifth of retailers' annual sales. Looking for any edge in a tight economy, some big box stores are now opening as early as 9 p.m. on Thanksgiving itself.

But that has inspired a Black Friday backlash from some employees who say that they are being cheated out of their holiday.

Target employee Anthony Hardwick, who has to be at work before the store opens at midnight, started an online petition protesting those early hours. He now has nearly 200,000 signatures.

"I'm going to have to get some sleep and I'll probably go to bed at 2:00 and miss my family's Thanksgiving dinner completely," Hardwick said.

Plenty of customers are sympathetic.

"I don't understand it. I think the stores have a lot of nerve doing this. I don't think the employees want to be working," shopper Joan Feslen said.

Shopper Jean Klinger agrees.

"I don't think it's a good thing. I think we're getting too far from our family values and traditions that we used to have," she said.

And are those bargains really worth all the crowds and chaos? Turns out, you may actually be better off waiting. According to Consumer Reports, last year more than a quarter of the most popular electronics were marked down in the two weeks after Black Friday.

"If you miss Black Friday weekend -- fear not, there are going to be more deals all the way through, week after week," said Marshal Cohen, chief retail analyst at NPD Group.

If you do venture out, Cohen says, do your homework. The best way to get a deal is to have a plan and know what you're buying ahead of time. So scan those circulars and websites.

Retails may also offer coupons that shoppers can print out for added savings.

And bring your smartphone. Eight in 10 stores plan to use social media to alert shoppers to the best bargains, and some online retailers may offer even better deals to steal shoppers stuck in those lines.

Copyright 2011 ABC News Radio

Thursday
May192011

Apple, Top Retailers Usher in New Era of Mobile Check-Outs

Jupiterimages/Thinkstock(NEW YORK) -- Shoppers dread long checkout lines -- and so do retailers, so they are increasingly turning to tricked-out, high-tech devices that bust lines and save time.

Apple led the way with its specialty credit card-reading iPod Touches that enable payment anywhere in a store, and retail experts say that's only the beginning.  Apple might soon one-up itself with new "wave-to-pay" Near Field Communication (NFC) technology, and industry watchers say big box retailers are preparing to usher in a new era of shopping that puts mobile technology at the center of a shopper's experience.

"One of the biggest challenges that traditional retail has is the fact that very little has changed inside the store compared to the dramatic changes that retail has seen on an online experience," said Marshal Cohen, chief industry analyst for The NPD Group, a New York research firm.  "The store has to change the experience."

While those changes may come in different forms -- from devices that enable mobile checkouts to programs that roll credit cards, loyalty points, and coupons into your cellphone -- Cohen said they'll start to emerge as experimental, progressive initiatives in the next year and graduate to an everyday self-checkout-like alternative in the next year-and-a-half to two years.

In the buildup to the 10-year anniversary of Apple's first retail store Thursday, tech blogs speculated that the company might unveil a new NFC payment system in its nationwide stores.

Citing "multiple Apple sources," the tech blog Boy Genius Report said that, ahead of its big anniversary, the company required store employees to spend "overnights" in its retail locations, making all kinds of secret preparations, including installing tables with different wiring.

The blog said one possibility is NFC-enabled devices that can beam and receive information within a distance of up to four inches.  Instead of swiping plastic to pay, customers could just wave an NFC-equipped phone near a compatible reader and the purchase amount would be deducted instantaneously.

While NFC-enabled Apple tables would need NFC-enabled iPhones and other i-devices to work, rumors earlier this year suggested a next-generation iPhone would come equipped with the technology.  At the time, Apple declined to comment on those rumors and the company did not respond to a request for comment for this latest rumor.

Copyright 2011 ABC News Radio

Sunday
Mar272011

Costco Asks State to Change Liquor Laws, Again

Getty(KIRKLAND, Wash.) -- Wholesale giant Costco is taking another shot at the privatization of liquor, just months after its proposed I-1100 bill was rejected.

In November, Costco proposed a bill that would allow any store with a liquor license to sell hard liquor, thereby eliminating the state from cashing in on what private retailers like Costco believed would be a profitable move.

However, the company's pitch failed to convince lawmakers that the state should hand over the right to sell booze to anyone who wants to, prompting Costco to revaluate its plan.

As a result, Costco is now pushing for a compromise -- allow any store more than 9,000 square feet the right to sell booze, and recoup additional tax revenue in return.

The proposal would include a profit-sharing plan whereby the state would potentially receive funds upfront by the retailer and subsequent liquor tax on a per-year basis.

State officials have yet to comment on Costco's latest pitch.

Copyright 2011 ABC News Radio

Friday
Feb182011

Consumer Prices Rise, but Price Apocalypse Not Here Yet

Photo Courtesy - Getty Images(WASHINGTON) -- For all the headlines this week about a rash of rising prices, the reality for American consumers is that there’s not much there.  At least not yet.

The latest figures from the Bureau of Labor Statistics show that overall consumer prices have increased just 1.6 percent in the past year.  The increase is well within historical norms for price gains and won’t have people having to choose between fueling the car or buying the "extras."

Of note, most of the increase in prices at the retail level come from an increase in the price of energy, which posted a 7.3 percent rise in the past year.  Gasoline, up 13.4 percent, and fuel oil, up 17.3 percent, lead the way in that category.

But despite rising "input" costs, there are big categories of consumer spending where prices haven’t gone up that much in the past year.

Food prices are up just 1.8 percent from the past year, while clothing prices remain literally unchanged at the retail level for consumers.  Shelter costs –- rents and mortgages -– are up just 0.6 percent.

Meanwhile, during the same period -- from January 2010 to January 2011 –- average weekly earnings have increased 2.5 percent, according to the Bureau's figures.  So the average American is actually coming out ahead, with their wage increases besting the increasing costs, but just by a little.

Why aren’t prices going up more?  Well, retailers have absorbed some of those increasing costs for fear that American consumers aren’t ready to see prices go up.

And this lack of pricing power for retailers is likely keeping hiring in check.  If retailers believe they can’t pass along increasing costs, they're not likely going to increase their fixed costs by adding workers.

But this tepid consumer price environment is likely going to change in the coming months.  Big companies are starting to signal to the markets that they're ready to start passing along increasing costs.

If they are able to increase prices without a significant drop in sales, this "inflation" might actually be a good thing.  It might give the companies confidence to hire, as it’s a real world signal that the economy has recovered enough to handle rising prices.

Copyright 2011 ABC News Radio







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