"What word should I use? Terrible? Horrible? Miserable?" said Homi Patel, chairman and chief executive of Hartmarx Corp., a Chicago-based clothing manufacturer of suits and sportswear, when asked to describe the 2008 holiday. "There is a time when the consumer isn't going to shop. It doesn't matter if it's 70 percent off or 80 percent off, the mind-set is, 'I just don't want to shop.' And that's something we haven't seen in quite some time."
With credit harder to come by, homes no longer a source of quick cash, and stock portfolios shrinking, retailers are bracing to duke it out for every dollar this holiday. Merchants are keeping inventories lean to avoid the risk of costly markdowns. And they are making a keen effort to keep prices down.
In a sign of what is ahead, Costco Wholesale Corp., the warehouse club chain that has steadily weathered the economic slowdown, warned Wednesday that profit for the current quarter would be "well below" Wall Street estimates as the company grapples with higher energy costs and holds back on price increases in order to keep customers.