Nov 5, 2007

Dive into holiday discountsBy Sheryl HeanStar-Telegram.com

Debbie Thompson of Glen Rose enjoys buying Christmas gifts for her five children and five grandchildren — to the tune of about $2,000 last year.

This year will be different, with Thompson planning to spend about $600.

“It’s going to be a lot less this year because I’m out of a job, and I had to go back to school,” Thompson said. “And on my husband’s income, we’re just getting by.”

Consumers like Thompson, who are being squeezed by higher food, fuel and housing costs, could make the holidays a little less cheery for retailers.

U.S. retailers are predicting their worst holiday season in five years because of the housing slump and other economic concerns. In addition, a series of toy recalls has raised questions about toy safety, which could hurt holiday sales. Retailers typically generate about half their annual sales in November and December.

As a result, consumers should see deeper price discounts earlier as retailers hope to boost traffic, industry experts say. It’s already started, with retailers such as Circuit City, Toys “R” Us and Wal-Mart offering special deals now.

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