A Sugarplum Shopping Spree

By Stephen Koepp

From cashmere to computers, Christmas sales soar

"A merry Christmas, Bob!" said Ebenezer Scrooge to his clerk Bob Cratchit after waking from his nightmare in Dickens' A Christmas Carol. "A merrier Christmas, Bob, my good fellow, than I have given you for many a year!" America's merchants this year can feel as happy as Bob Cratchit, for consumers are giving them their merriest Christmas for many a year.

The economy's boisterous recovery has put shoppers in the mood to buy the best and the brightest, from $600 home computers to $300 cashmere bathrobes. At Manhattan's Bonwit Teller, customers have already taken home 2,300 pairs of mink earmuffs at $85 each. According to Lien Dang, a Neiman-Marcus sales clerk in Houston, consumers want "something wild, something different, something out of this world."

By the time cash registers fall quiet on Saturday night, retailers expect to see a holiday season sales gain of up to 15% over last year. This would make 1983 the strongest Yule since 1977, and even that could turn out to be a conservative prediction. Says Esther Brunswig, manager of the Emporium-Capwell department store in Palo Alto, Calif.: "We're going to have the biggest Christmas ever. Everything is selling." Merchants ranging from Gucci in Beverly Hills to the McRae's department store chain in Jackson, Miss., are ringing up their highest daily revenues on record. Last week the Commerce Department announced that retail sales jumped 1.9% in November from the previous month, which was about twice the rate expected by many economists.

Consumer confidence is in full bloom. The University of Michigan's autumn survey of public attitudes measured the highest level of optimism about the economy since 1972. A prime reason is the fall in unemployment. Some 3.5 million more Americans have jobs this Christmas than last, and people are less concerned about losing employment. Last week the Federal Reserve reported that consumer installment debt rose a record $4.9 billion in October, a sure sign that consumers expect the business recovery to continue. Observes Beverly Garner, owner of Gilt Edge Gifts in Cincinnati: "Shoppers don't have the down-in-the-mouth look they had last year. I can't overemphasize the change in attitude." Chicago Advertising Executive Maribeth Auer had cut back on store-bought gifts during the recession, baking cookies for friends instead. This year she is back in the shops. On one trip last week she spent more than $100 on such presents as jewelry and scarves. Dairy Store Manager William Bales and his wife, who live in the Cincinnati suburb of Norwood, are enlarging their gift-giving circle this year. Said he: "The economy has been a little better to us this year. We have caught up on our bills, so we can spend more."

Throngs of jolly shoppers are jamming streets from San Francisco's Union Square to Manhattan's Fifth Avenue. An estimated 30% increase in store traffic as compared with last year has created three-deep layers of customers around display cases and has made parking spaces as scarce as Cabbage Patch dolls. Said Edward Brennan, chairman of the Sears merchandise group, after touring a company store in Oak Brook, Ill.: "It was wall-to-wall people. It made me feel great."

Many shopkeepers feel exhausted from trying to keep up with their ravenous clientele. "It has been so fast we've had to bring people in as early as 5 a.m. to restock the shelves," groans E. Erick Gaither, manager of a Sears store in Tucker, Ga. At Palo Alto's Emporium-Capwell, employees are often so harried they forget to take their breaks. Said Heidi Thomas, a clerk in petite women's wear: "Last Saturday we were swamped. A lot of shoppers had clothes draped over their arms. I was so busy I couldn't handle it all."

Shoppers seem to feel a sense of urgency this year, inspired partly by spot shortages of such popular gifts as exercise wear and stuffed toys. Said Michael Brownlow, a railroad conductor from Doraville, Ga., who took a day off last week to shop in a suburban Atlanta mall: "If you wait until the last minute, things will be gone. I had to get up Sunday morning and stand in line for half an hour just to get one of the toys my son wanted." Parents often have to act like detectives to find such other scarce playthings as Return of the Jedi characters and Masters of the Universe figures. Many merchants, having grown accustomed to lackluster sales, ordered relatively small amounts of stock and now they are regretting it. Says Analyst Stuart Robbins of Wall Street's Paine Webber Mitchell Hutchins: "Last year retailers were worried about paying their mortgages. This year they're worried about having enough merchandise."

One of the biggest shortages is in home computers. An estimated 2.5 million will be sold this Christmas, nearly twice as many as last year. But such manufacturers as Commodore and Atari have been able to fill only about two-thirds of their orders. The home-computer price war that followed last summer's glut of the devices has helped stimulate demand to a record level. When Computer Programmer Lawrence Hoyle bought a Commodore 64 as a present for his nieces and nephews last week at a K mart in Lawrence, Kans., he paid about $500 for the computer, software and a disc drive. Said he: "A year ago I would have spent three times as much."

Computers will be joined under the tree by many beeping and buzzing friends. The electronics industry expects sales to increase by almost 25% this year over 1982. Sales of video cassette recorders will grow by more than 100% this year, and microwave ovens by nearly 50%. The high-tech clinkers this year are video games. About $1 billion worth of cartridges and consoles are expected to be bought, a 50% drop from 1982.

Meanwhile, at the other end of the technology scale, such old-fashioned toys as board games and Teddy bears are also doing well. Among the most wished-for ursines are American Greetings' Care Bears (about $20), which the company produces in a range of models from sleepy to grumpy. Macy's stores in Northern California expect to sell out their entire population of 50,000 stuffed bears, including mink ones priced at $200. The trendy board game Trivial Pursuit (price: $25) is hard to find in stores, and even sales of Monopoly are up about 10% from last year. Thanks in part to booming sales of G.I. Joe dolls, stodgy Hasbro Industries, which stayed out of the videogame wars, expects to increase its profits by about 60% this year.

Among grownups, kerosene heaters are out, sweaters are in. Heater sales have slowed with the abating of the energy crisis, but sweaters are showing that there are other ways to stay warm. Says Bonwit Teller Fashion Director Missy LoMonaco: "Sweaters are the runaway hit of the season." Among the most popular styles are those with delicate weaves that are adorned with beads and sequins. Price: $80 and up. In Manhattan's Saks Fifth Avenue, cashmere sweaters with rhinestones are selling briskly at $525.

An undercover fashion hit is Calvin Klein's briefs ($7.50) and tank tops ($8.50) for women, which are available in 25 colors. Says one New York City merchant: "People are going crazy fighting over the underwear."

Wealthy shoppers who held back a bit during the recession now seem to have lost their inhibitions. Last week a businessman walked into Bijan, an exclusive shop on Beverly Hills' Rodeo Drive, and purchased four chinchilla bedspreads priced at $98,000 each. One well-to-do woman said the nuclear horror film The Day After had convinced her that she should spend as much as she can before the Bomb goes off. Less cataclysmic was the explanation given by Melinda Graves, a shopper in Rodeo Drive's Giorgio boutique: "My husband made a lot of money in the stock market recently, and now it's time to spend it."

High-quality, relatively expensive goods have even attracted middle-class consumers, who see such purchases as an investment. Said Larry Coffey, manager of the Brooks Brothers store in Atlanta: "Price doesn't seem to be any object whatever." Adds Jerry Detloff, manager of the B. Siegel women's wear store in Birmingham, Mich.: "A $500 coat is as easy to sell as a $25 sweater."

Gourmet food may be a less prudent purchase, but is no less popular. At the Neiman-Marcus store in Chicago, the fast-moving delicacies include Beluga caviar at $345 a pound, a tin of jumbo twisted pretzels for $24 and salmon filled with a mousseline of sole for $18 a pound. One day last week, Neiman-Marcus Shopper Katy Sutler was deliberating the purchase of a $26 tin of pate defoie gras as a stocking stuffer for her husband. Said she: "It's his very favorite thing."

Being able to indulge themselves appears to make consumers happy. Shopkeepers across the U.S. tell of an unusual degree of friendliness and courtesy this year. "They come and they go in swarms," observes Atlanta F A O Schwarz Manager Stewart Brown, "but everyone is very polite." Said Betty Casern, who was buying a fur cap and a robe as gifts last week in the Maison Weiss boutique in Jackson, Miss.: "I just feel in a more generous mood this year. I'm more cheerful and not as uptight."

Of course, islands of hardship remain. In northern Minnesota's iron range, joblessness stands at about 21% as a result of the battered steel industry. Jerry Erickson, owner of a Hibbing, Minn., music store, foresees no pickup in business this year. Said he: "People who are unemployed have been out of work a long time. They've used up all their benefits."

In Duluth, the Salvation Army expects to provide about 700 families with such small presents as gloves and socks. Unemployment is still 13.3% in Peoria, Ill., where the Caterpillar Tractor firm is struggling to return to health. Said Clinton Jostad, the manager of the local Northwoods mall: "There is at least a feeling that we have seen the worst."

The welcome end of the recession and strong sales mean fewer bargains this year. Some consumers have been disappointed that they are not seeing deep discounts like last year, when overstocked retailers began desperately chopping prices as early as October. Said Cindy Rose, manager of a Swiss Colony gourmet food shop in Atlanta: "Everybody wants deals. They all want discounts." Nonetheless, she added, people's resistance appears to fade away quickly. "They are dropping money a lot quicker. There are bigger dollars."

Most pre-Christmas sales this year are aimed at drawing shoppers into the stores rather than liquidating surplus stock. Says Gordon Cooke, senior vice president at Bloomingdale's Manhattan store: "We have not had to discount excess merchandise this year." One of Bloomingdale's biggest promotions was a campaign to sell cashmere and pearls as a chic duo. Adds Cooke: "Most of the traffic we're seeing is around the cash registers, and that's a welcome sight."

Perhaps the biggest present of all this holiday season will be the stimulus that Christmas sales will give to the economy. Says Economist Irwin Kellner of Manufacturers Hanover Trust: "The recovery is going to get a nice forward push from the Christmas season." When factories in crease production so that stores can restock their shelves, business will be off to a good start in 1984.

--By Stephen Koepp. Reported by Cristina Garcia/New York and J. Madeleine Nash/Chicago, with other bureaus

With reporting by Cristina Garcia, J. MADELEINE NASH This file is automatically generated by a robot program, so viewer discretion is required.