Will Blizzard Blow Away Sales?

Dec. 19, 2009 — -- Retailers up and down the eastern seaboard could take a major hit over this crucial pre-holiday weekend as the season's first blizzard blasts up the coast.

Traditionally, Super Saturday -- the last Saturday before Christmas -- has brought in an estimated $15 billion in sales, but the extreme weather is threatening to put a deep dent in sales.

"This is bad news, as it will hit significant population centers," said Scott Bernhardt, COO of Planalytics, which measures weather impacts on shopping behavior. "Lots of people will be affected by this storm."

Retail consultant Burt Flickinger said the storm is hitting an area filled with malls and big box retailers like Walmart, Kmart and Toys "R" Us. Flickinger said he worried that malls will lack sufficient snow plows to clear out parking lots and that cutbacks by local and state governments of law enforcement will lead to insufficient traffic control in shopping areas.

He pointed out that it was difficult for shoppers to get in and out of stores this year on Black Friday when the weather was warm and dry. With inclement weather, the situation could be worse and shoppers may opt to stay home, perhaps even shopping online, as many shippers have extended the deadline for packages to arrive in time for Christmas.

"The one thing a retailer doesn't want is a major snowstorm on the Saturday before Christmas," Marshal Cohen, chief industry analyst at the NPD Group, told Reuters. "This is definitely not the Christmas gift any retailer would ever ask for.

"It was kind of eerie the Friday night before Christmas to see some of the retail malls not as busy as they should have been," he added about the sporadic shopper traffic he saw at stores on the East Coast.

But other retail experts aren't so sure.

"It's not like people are going to suddenly stop shopping," said Bob Phibbs, CEO of the consulting firm The Retail Doctor. "I think we need to have a little balance. It's not like the demand goes away with a storm. Aunt Clara still needs her perfume and you still need to get chocolates for your wife."

Winter Storm Threatens Retailers' Bottom Line

He had a simple message for store owners.

"Whatever you do, stay open," he said. "If people can get to your store to shop, then your employees can get to the store to work."

And he urged retailers to get the word out.

"If you're on Twitter, Facebook, get that message out," he said. "If you're expanding your hours rather than contracting them, get the word out. People will come back."

And while some major retailers like J. Crew and Macy's were still offering free shipping through Saturday night, Phibbs pointed out that many Super Saturday shoppers will be reluctant to risk taking their business online at the last minute.

"They'll come back [to stores] one way or another," Phibbs said.

"Besides,'' he said, "traditionally, guys are the biggest last-minute shoppers and they'll brave the snow to get the gifts."

The National Retail Federation reports that as of Dec. 9, 47 percent of retail shoppers had not checked everything off their list.

"I'm, like, less than halfway [finished], I have so much more to go,'' shopper Rosa Garcia told ABC News at the Manhattan Mall. "I always do this. ... I heard that two weeks before Christmas is when all the sales start, so I waited, but most of the things are gone."

Garcia is not alone. Experts say retailers -- expecting another difficult year -- ordered less inventory this year to try and protect their profit margins. As a result, a lot of shoppers are finding popular items sold out.

While shoppers were able to hit the store in the New York area before the brunt of the storm hit, further down the coast, the blizzard snarled shoppers who couldn't even reach the malls on snow-socked roads. Many hopeful shoppers hit the stores early in the morning.

"I got out early because I'm going now to beat the snow,'' Gloria Curry told ABC News.

The heavy snow could mean lower prices this week.

While experts say retailers weren't forced to resort to the desperate markdowns of last year, some may be ready to press the panic button after this wintry weekend.

"If the traffic doesn't materialize at the malls because they can't get there, retailers might have to get a little more promotional than they were hoping to going into this weekend," said Lori Wachs, vice president of Delaware Investments.