Black Friday Fails To Save U.S. Retail Industry As November Sales Dip

New York, NY (AHN) - Although thousands of Americans trooped to malls and department stores on the Thanksgiving weekend, it was not enough to save the ailing retail industry in the U.S. According to the International Council of Shopping Centers, November sales were the weakest in over 35 years.

The council said all retail segments monitored by it suffered sales slump. The worst hit was department stores which registered a 13.3 percent decline, followed by specialty apparel retailers which logged a 10.4 percent decrease.

Some stores, just to move inventory, offered deep discounts. Because of that business strategy, department store profits are expected to go down by 20 to 60 percent in the fourth quarter of 2008, said Bill Dreher, senior retailing analyst of Deutsche Bank Securities.

Even high-end stores had to play the bargain game or face financial disaster. Some high-end apparel had 70 percent off price tags. Abercrombie & Fitch, which did not bring down prices, suffered a 28 percent dip in its sales, on top of 20 percent and 14 percent sales decreases in October and September.

Not surprisingly, discount chains such as Wal-Mart, known for offering hefty discounts, enjoyed a 3.4 percent growth in its sales.

Dale Achcabal, the executive director of Santa Clara University's Retail Management Institute, said the coming months will be a very, very challenging time for the retail industry since consumers will likely hold on tightly to their purses.

The key to surviving in a business environment like this is to understand and anticipate consumer behavior.