Report: Retail bargains are on the way

Oct. 21, 2005 at 9:30 AM
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WEST LAFAYETTE, Ind., Oct. 21 (UPI) -- U.S. holiday shoppers will find an unusually large number of discounts and bargains, a university study is predicting.

A Purdue University analysis forecasts U.S. retailers will shave costs to coax buyers to drive to their outlets.

"While consumers have adjusted to $3 per gallon gas and have kept spending, high gas prices act like a tax on retail spending," says Richard Feinberg, director of the Purdue Retail Institute and Center for Customer-Driven Quality.

"Retailers realize that fewer visits by consumers because of high gas prices mean they must offer bargains, sales and promotions designed to 'compel' spending."

Feinberg predicts consumers will spend 2 percent to 6 percent more overall than last year, but retailers will see an increase of only 1 percent to 4 percent, when they'd much rather be in the double-digit range.

Internet sales will increase $5 billion from $20 billion last year, but Internet spending still represents only 5 percent of the $435 billion that will be spent this year.

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