I've been reading Credit Suisse (CS) analyst Gary Balter's reports on hardline retailers since the mid-'90s, when I wrote about companies like Home Depot (HD) and Sears (SHLD). Balter is not only a savvy analyst. He's also a very good writer. This morning at 7:17, Balter emailed this note to clients about Black Friday shopping, which he titled "Bring Back the Good Old Days." I'm on his email list, so I read it and enjoyed it so much that I asked him if we could reprint it on Postcards. "Absolutely," Balter replied. So here's a veteran Wall Street analyst on how Black Friday 2010 is upending our holiday shopping rituals.--Patricia Sellers
Guest Post by Gary Balter, managing director and senior analyst, Credit Suisse
What is happening to America? For years, we looked forward to getting together with the in-laws on Thanksgiving, watching some football, eating some turkey, and most important, pouring through every Black Friday ad and dividing up which stores we would each wait in line for. Waking up at 3 a.m., we would not only rush to get in line but would be in communication with the team--figuring out if Circuit City had fewer people in line, by 4 a.m. knowing if we would get one of the better door-busters at Best Buy (BBY), what the lines were like at Wal-Mart (WMT), etc.
Things began to change well before the Internet. About six years ago, CompUSA (SYX) decided to begin its Black Friday sales at midnight. That meant getting in line on the way back from turkey dinner, and then getting but a few hours of sleep before beginning the hunt in the a.m. Of course, since it seemed that every CompUSA purchase required one to fill out a rebate form, that effort used up any time otherwise reserved for sleep.
Returning home from all stores by 8 a.m. at the latest, we would call the family and discuss splitting up the prizes, meeting somewhere between New York and Allentown, Pa., to celebrate together. Total savings on anything we really needed was likely nothing, but the thrill of the hunt kept us going. Friends of our cousins, when meeting us, would know exactly which product we had waited for and how much money we had "saved."
A few years ago, sites like bfads.net started to compare all of the Black Friday ads. Although it made it easier, it seemed to take the thrill out of comparing the products. However, even with that, we still had the cold weather to look forward to the next morning.
About four years ago, our world changed. We discovered that in some stores, including Circuit City, one could go online on Thanksgiving and buy the Black Friday ads. The following year, others followed, but the better stores still kept their best sales for those who would wait in line.
This year, we are getting Black Friday sales for weeks before Black Friday at Sears, Kmart, Wal-Mart and Best Buy, among others, and have the ability to buy just about every ad on-line, with many stores opening on Thanksgiving. Looking at what looked like prizes worth standing in line for, at Staples (SPLS), for example, we were dismayed to read that we could buy the same products on-line from 6 a.m. to 10 a.m. That is going to hurt sales of winter clothing, as we won't have to stand in below-zero temperatures for that sliver of a savings.
May we suggest that someone in the government, at least in the colder northern states, pass a law that does not allow one to call savings 'Black Friday' until Black Friday? Until then, enjoy the warmth, and Happy Thanksgiving.
Have you noticed that Starbucks' (SBUX) stock has popped up from its seven-year low? Last Monday the shares were trading below $10. Then they got a boost last Wednesday when CEO Howard Schultz noted that he saw a slight upturn in store traffic in October. The stock has outperformed the broader market rally and is now trading just below $13.
Another reason for the nascent recovery: A Starbucks promotion at Costco MOREPatricia Sellers - Nov 3, 2008 3:24 PM ET
I've talked on Postcards about the greatest sins of the big retailers: believing that if you build it, they will come. That focus on growth at all costs has hurt Starbucks (SBUX) and Home Depot (HD), whose stocks have just recently risen risen off of 52-week lows. Speaking of lows, there is Lowe's (LOW), which announced earnings Monday morning: down 8% in the second quarter. But thanks to solid expense MOREPatricia Sellers - Aug 18, 2008 1:23 PM ET
Jirka called! On Tuesday, I told you about my unforgettable interview with Jirka Rysavy, the founder and former CEO of Corporate Express, the office-supply company that Staples (SPLS) is buying for some $4.7 billion. This is the guy who lived in a cabin in the woods above Boulder, Colo. "I still live in the same place," Rysavy told me when he phoned Friday afternoon. Now he's the CEO of a MOREPatricia Sellers - Jun 20, 2008 6:00 PM ET
It looks like Staples' (SPLS) decision to buy Corporate Express for some $4.7 billion is a smart one. Wall Street has applauded this deal. Gary Balter, who follows hardline retailers for Credit Suisse, notes that with the acquisition, Staples will dwarf other office supply distributors. It'll have $27 billion in annual revenues vs. Office Depot's $16 billion.
Betcha don't know Corporate Express—beyond the label on the office-supply boxes in your hallway. MOREPatricia Sellers - Jun 17, 2008 4:18 PM ET
|McDonald's gives Charles Ramsey free food for a year|
|The 'chicken poop' credit and other bad tax breaks|
|Want to invest in Samsung? Good luck!|
|Stocks: Soft going into holiday weekend|
|Japan stocks close up after big plunge|