Jan. 9 - Pressure to make the sale put pressure on margins at retailers over the holidays, leading to tough reality checks when their final numbers were tallied. Bobbi Rebell reports.
The pressure to sell put too much pressure on margins for retailers over the holidays. And now that the December sales data is coming in- it's clear the holidays were no cause for celebration. While sales were up- the heavy discounting resulting in smaller profits for may chains stores like L brands- parent of Victoria's Secret, and Family Dollar: Liz Dunn covers the retail sector at Macquarie: SOUNDBITE: LIZ DUNN, SENIOR CONSUMER AND RETAIL ANALYST, MACQUARIE (ENGLISH) SAYING: "The shortened holiday season definitely challenged retailers. Retailers walked into the quarter having a little bit too much inventory and I think there just wasn't a lot of fashion." Shoppers stayed home- foot traffic dropped close to 15 percent this holiday season. Good for online retailers like Amazon- but online is still a small percentage of overall retail sales. And while many stores got increasingly aggressive in their promotions to drive sales- most still took a hit on the bottom line. The strategy however, did work for Macy's. The retailer has been re-tooling its marketing approach- it says its holiday sales were up. SOUNDBITE: LIZ DUNN, SENIOR CONSUMER AND RETAIL ANALYST, MACQUARIE (ENGLISH) SAYING: "They have the products that the consumers want and they are not afraid to offer you know really excellent value so a number of things worked in their favor. We also saw a big jobs cut announcement from them a bit sort of restructuring which is going to save them significant amount of money and led them to guide next year above consensus expectations." Perhaps the biggest problem for retailers is something they can't do a lot about. Shoppers are still worried about their jobs, the economy- and many of them just don't want to shop in the extreme cold weather.