Americans headed to department stores in droves in the dead of night on Friday to kick off the holiday shopping season, though many said they had pared back how much they would spend on family members and on themselves.
Black Friday, the day after U.S. Thanksgiving, is often the single busiest shopping day of the crucial holiday season, which accounts for nearly one-fifth of the retail industry's annual sales.
The annual festive ritual of American consumerism is now being monitored closely for signs the U.S. shopper is again ready to propel the economy forward, after the global financial crisis last year led to the worst holiday season in nearly four decades.
Debra Diriwachter, a supermarket cashier, waited for several hours outside the Queens Center mall in New York before doors opened at 11 p.m. EST on Thursday. She is cutting back her gift budget this year and will only use cash for purchases.
I don't like to be in debt and if I know what I am spending, that's good, she said.
The first 200 shoppers entering the mall, some in their pajamas, were handed $10 gift cards to whet the appetite.
This is beautiful. I am so happy, said Roberto Tomala. This is a good motivation to everybody. In this situation, even $10 helps to buy something
Up to 134 million U.S. consumers say they may shop for holiday gifts this weekend from Black Friday through Sunday, according to the National Retail Federation.
That is up from last year's survey, taken weeks after the global financial crisis erupted, but still below consumer Black Friday plans reported ahead of the shopping season in 2007.
Discount retailers like Wal-Mart Stores Inc and Target are expected to see the heaviest traffic over the holiday weekend, followed by department store chains like Macy's and Kohl's.
They and their industry peers have spent the past year shrinking inventory, shutting stores or scaling back new openings, to avoid steep discounts and protect profits.
Last year they literally gave the merchandise away, said Marshal Cohen, senior analyst at retail consultancy NPD Group. This year, they have to sell half as much as last year to break even ... so even if they don't sell as much they're going to make money.
TIRED OF THRIFT?
Some industry experts expect a strong turnout on the Black Friday weekend, but cautioned that did not mean a strong holiday season, as shopping tails off in the weeks before Christmas.
The unsettled state of the U.S. economy, with a 26-year high in unemployment and tighter access to credit, has industry holiday sales forecasts varying widely from a decline of 3 percent to an increase of 2 percent.
Early hopes for a consumer-led recovery have pushed retail shares up 47 percent this year, compared with a 23 percent rise for the Standard & Poor's 500 Index.
While most research in the last two months showed shoppers planned to spend less or the same in 2009 from a year ago during the holidays, that stance may be softening.
Nearly one-third of consumers surveyed by Deloitte said they now expect to spend more than they had planned a month or two ago. The survey, conducted last week, polled 1,051 people with a margin of error of plus or minus 3 percent.
Carma Edwards, a 29-year-old nurse, is one of those shoppers who has tired of thrift. She bumped up her holiday budget to $2000 from $500 last year.
Asked what triggered the splurge:
A new job! she said.
(Editing by Valerie Lee)