Big Retailers Confirm Slow Yuletide Sales

The nation’s largest retailers closed the books on a disappointing Christmas today, releasing December sales figures that confirmed how skittish consumers have become in the face of a recession and possible war in the Middle East.

A number of key retailers reported business fell in comparison with the 1989 holiday season: Sears, J. C. Penney, May Department Stores and Carter Hawley Hale Stores.

Even Wal-Mart Stores, which has consistently outperformed the rest of the retailing industry, had a relatively sluggish month. But specialty apparel stores, particularly Gap Inc., fared better than other companies.

With economists forecasting that the recession will continue well into this year, retailers were glum about prospects for a turnaround in business.

“Consumer confidence is as low as I have seen it in more than 20 years,” said Kenneth Macke, chairman of Dayton Hudson Corp. “We are not optimistic about the first half of 1991.”

Retailers expected Christmas to be difficult after their sales fell sharply in the aftermath of the Iraqi invasion of Kuwait in August. As oil prices shot up and Americans started paying more for gasoline and home heating oil, they had less money to spend on clothing, furniture and appliances--the mainstay of the big retailers’ business.

Store owners reported during the season that consumers were shopping very cautiously, seeking the lowest prices possible and cutting back on the number of gifts they bought. Many retailers slashed prices in an effort to bring shoppers into the stores, but the move was expected to lower stores’ earnings at a time when they had hoped to make half their annual profits.

Unusually warm weather also hurt sales in parts of the country, forcing many retailers to move up their winter apparel clearance sales by several weeks.