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llrlTH proper planning ChristUU mas 1988 will be profitable.

That's the message from James Newton, president of Economic Perspectives, Inc., despite a contrary prediction by some retail analysts. "While we don't see this year offering substantial sales growth prospects, we do feel that it will be a more profitable Christmas," he says. "Through proper planning, retailers should be able to halt the supposedly never-ending game of chicken which often holds down their profitability prospects. "

The game of chicken refers to the theory that consumers have wised up to the ways of the retail world and will refuse to buy any merchandise that isn't heavily marked down.

"Kind of like a game of chicken between two high schoolers in their cars, with the retailer always being the first to pull offthe road to avoid a head on collision," Newton explains.

Home centers are included among the store types which he expects to post favorable sales results compared to the fourth quarter of last year. He projects that total retail sales will increase by better than 5olo compared to the same time last year. After inflation adjustment, this will be a relatively modest 1.50/o2.00/o sales increase. "While not a barnburner by any stretch of the imagination, it is far better than the virtual stagnation that was experienced last year in terms of real sales growth," according to Newton. "And what's even more important is that retailers will be achieving these sales gains at a time when inventories are expected to be tight and the consumer is no longer cutting back on purchases. As a result, the game of chicken can be avoided through more selective markdowns and retailers can earn a decent profit on what they sell during this Christmas season."

"lt should be pointed out," according to Newton, "that one wild card in this outlook remains the pricing decisions made by the retailers. lf prices are raised too much in an attempt to make up for lost time and the increased costs of doing business, consumer resistance could stiffen and the game of chicken could be started all over again. But barring such an occurrence, Christmas 1988 should indeed be a merrv little affair."

Story at a Glance

Inventory, service and price planning can enable a retailer to avoid playing "chicken" with the customer over what to pay for Christmas season merchandise now's the time to get started. What can the retailer do to encourage his customers to buy? First, he can make the store as festive and holiday oriented as possible. Decor- ated windows, seasonal endcaps, festive decorations and Christmas music will add to the spirit.

Next, the retailer can set aside an area for a holiday promotion of ornaments, tree stands, artificial trees, wrapping paper, ribbons, gift boxes and other items needed by his customers. If the store carries toys, a special Santa's workshop section is in order with a real live Santa if possible.

Holiday dress for all departments and lots of ideas for gifts ranging from inexpensive to costly are other requirements. Make it impossible for a customer to leave the store without getting inspiration for at least one gift.

Instruct sales people to inquire of each customer if they've finished their Christmas shopping and then point out several items appropriate for gifts. Set aside a special night for women shoppers with experts to help them select tools for the men on their lists. Repeat the event for the men, helping them to select appliances or houseware items. A special section of low cost stocking stuffers will help everyone, especially the children with slim allowances.

A retailer can make his store so festive and his service so impressive that shoppers forget about price, comparison shopping and mark downs. Extras such as delivery of large purchases, assemblingtoys and bicycles, gift wrapping, layaway and holding for pick up on Christmas Eve help to mitigate any price difference.

Some imaginative planning will make it a Merry Christmas.