NEW YORK - Just as they did at the start of the season, more of the nation's stores are pulling marathon hours this week in the holiday season's finale. But with the crowds at 4 a.m. hardly what they are at 4 p.m., are the extended hours worth it?
Experts say yes, noting that the additional labor costs are minimal compared with the goodwill that stores enjoy by offering a convenience to time-starved shoppers - especially when sales are already so dismal.
"It makes sense, and cents, especially this year," said Stifel Nicolaus & Co. Inc. analyst Richard Jaffe.
The all-nighters, which have been gaining ground in the last three years, show how nervous retailers are trying to grab last-minute shoppers in the final hours of a season that's expected to be dismal.
Starting last Friday, the Toys R Us store in Manhattan's Times Square is keeping its doors open for 134 hours straight until tonight, Christmas Eve. Macy's Inc., which had only several locations in the New York metropolitan area open 24-7 last year, now has 13 stores in areas including Chicago, Washington and Detroit that are pulling all-nighters in the final days before Christmas.
Marshal Cohen, chief industry analyst at market research firm NPD Group Inc., said he believed retailers had no choice. If "you don't do it, you are giving up your share to someone else," he said.
Besides the bleak economy, retailers this year have faced a holiday shopping season with five fewer days than last year between Black Friday, the day after Thanksgiving, and Christmas.
In many cases, stores open 24 hours during the holiday season already have workers in overnight stocking the shelves and cleaning - so opening the shop for customers requires only minimal sales help, said Joel Bines, director at consulting group AlixPartners L.L.P. Electricity costs are not a big issue, since stores are paying off-peak rates.
"The big question is whether you actually increase customer traffic and sales or are you spreading it out," Bines said. He said he believed that in a normal season, stores were just spreading out the sales.
Ken Perkins, president of research company RetailMetrics L.L.C., said the incremental labor costs of expanded hours were not going to hurt profit margins as significantly as the dramatic markdowns were.