Retailers react as consumers prepare to cut back on holiday shopping

by Sarah Rice (srice@wsbt.com)

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Meijer employees are gearing up for Christmas sales in Mishawaka (WSBT Photo)

Meijer employees are gearing up for Christmas sales in Mishawaka (WSBT Photo)

By WSBT News1

Story Created: Oct 12, 2008 at 3:55 PM EST

Story Updated: Oct 15, 2008 at 10:14 PM EST

MISHAWAKA -- The holidays are only two months away! But this year, some aren't feeling quite as merry, as the struggling economy continues to fuel feelings of holiday fear. Retailers are reacting by dropping prices even earlier this year. And consumers we spoke with couldn't be happier.

Money is tight for mother of five Ranay Reed.

"The economy and we're trying to cut back. And I'm a full-time student, so we only have the one income this year," Reed explained.

Less money means fewer options. With Christmas just a few months away, Reed is already planning to cut back on her holiday shopping.

"We're going to do more of a system where we do four basic presents. Something that they want, something they need, things like that. It's just going to be real basic," said Reed.

And she's not alone.

"So I think with her and him I'm just going to stick with movies and clothes this year and cut back on more toys," said shopper Paula Connell.

According to the National Retail Federation, holiday sales are expected to rise only 2% this year. The gain falls well below the 10-year average of 4.4% percent. This year's projection represents the slowest growth since 2002.

With more people looking to scale back this holiday season discounts on items like toys will be especially important. That's why retail giants like Meijer are preparing to put out more sale signs.

"We have a bunch of toys that are currently reduced in price and we're going to drop hundreds more this coming week so people can have a good Christmas despite the economic times," said Meijer Store Director Rick Zeef.

And Reed will certainly be taking advantage of the early savings.

"Usually we wait until the day after Thanksgiving, but now we're starting earlier this year," said Reed.

In hopes that this Christmas will still be merry and bright.

Wal-Mart is also slashing prices ahead of the holiday shopping season. The retailer recently announced their $10 toy. This includes popular toys like Barbie Dolls and Hot Wheels car sets.

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