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Weekend Sales Jump 22% to $27.8 Billion, NRF Says (Update1)

By Cotten Timberlake

Nov. 27 (Bloomberg) -- U.S. retail sales jumped 22 percent to $27.8 billion during the post-Thanksgiving weekend, as shoppers flocked to stores to buy electronics, clothing and books, the National Retail Federation said.

Shoppers spent an average $302.81, the Washington-based trade group said today in a statement. It said 145 million shoppers went to stores and the Internet, as retailers offered substantial discounts.

The statement followed positive reports from retailers as they offered giveaways and price cuts to generate the 6 percent holiday sales growth forecast by the NRF. Wal-Mart Stores Inc., the world's largest retailer, said yesterday that November comparable-store sales at its U.S. outlets rose about 4.3 percent, helped by a strong start to the holiday shopping season.

``Even though many retailers saw strong sales this past weekend, companies will not be basking in their success,'' said Tracy Mullin, the NRF's chief executive. ``Stores are already warming up for the next four weeks because the holiday season is far from over.''

In a separate statement issued yesterday, Visa USA said retail spending on Visa credit and debit cards rose 12 percent on the Friday after Thanksgiving, led by purchases of electronics and computers. Research-company ShopperTrak RCT Corp. said sales on Black Friday were little changed from a record set a year earlier. The day after Thanksgiving got its name because it's when many retailers were said to become profitable for the year.

Consumers were shopping for a variety of merchandise, with the electronics category showing the largest year-over-year jump, the NRF said. About 37 percent of shoppers bought in that category, up from 33 percent a year ago, it said.

Clothing

According to the survey, 49 percent of consumers purchased clothing or clothing accessories, while 47 percent bought books, CDs, DVDs, videos and video games.

``By offering incredible discounts, retailers were able to bring consumers to the stores who otherwise would have stayed in bed,'' said Phil Rist, vice president of strategy for BIGresearch, which conducted the weekend survey for the NRF. ``The deals were so enticing that many consumers abandoned their shopping lists and started buying for themselves.''

Sales on Black Friday totaled $8 billion, according to a preliminary estimate issued yesterday by ShopperTrak.

It was still ``a big start for the season,'' said Bill Martin, co-founder and executive vice president of Chicago-based ShopperTrak, in an interview. ``We know that doorbusters continued to drive more and more traffic in the stores. The question is: Are the retailers able to take advantage of that increased traffic and make it profitable?''

Discounts

Martin said discounts may have also hurt sales. Some electronics were being sold at ``30 percent lower than last year,'' he said.

ShopperTrak, a closely held company, issues national retail sales estimates throughout the holiday season. It devises the estimates based on U.S. Commerce Department data and proprietary information from retailers, according to the statement.

Bentonville, Arkansas-based Wal-Mart had forecast a sales gain this month of 3 percent to 5 percent from a year earlier at its U.S. stores open at least 21 months.

Holiday spending on Black Friday helped push general merchandise sales past food for the first week this month at Wal- Mart. More than 2 million customers visited Wal-Marts in the first two hours of shopping on Black Friday, said Pat Curran, executive vice president for store operations, in an interview.

Personal Entertainment

Spending increased to $2.2 billion, Visa USA said. Purchases of personal entertainment devices, including Microsoft Corp.'s Xbox and Apple Computer Inc.'s IPod as well as computers, accounted for 19 percent of all retail sales volume. Visa USA is a unit of Visa International Inc., the world's largest credit- card company.

``Discounts offered by retailers this year led consumers to shop in force on Black Friday,'' Wayne Best, a Visa USA economist, said in the statement. ``Consumer demand for multimedia entertainment devices such as the Xbox and the IPod will continue to drive retail spending during the holiday shopping season.''

Visa USA's retail figures include spending at discount, department and gift retailers as well as mail and phone orders.

About 27 million credit and debit transactions were made on Friday, the company said. Retail spending on credit cards alone rose 12 percent to $1.38 billion. Spending on debit cards also climbed 12 percent to $817 million, Visa USA said.

Discount and drugstores boosted Visa sales 8.4 percent, while department stores had an 8 percent increase from 2004. Mail and phone orders fell 7.1 percent.

The Standard & Poor's 500 Retailing Index, which doesn't include Wal-Mart, has gained 2.5 percent this year through Friday. On Friday, it rose less than 1 percent to 471.79.

Shares of Wal-Mart, which have dropped 4.3 percent this year because of the company's lackluster sales growth, fell 8 cents to $50.49 at 1:06 p.m. in the New York Stock Exchange's half-day session of composite trading.

To contact the reporter on this story: Cotten Timberlake in New York at ctimberlake@bloomberg.net

Last Updated: November 27, 2005 12:51 EST