Holiday retail sales forecast to drop 3.5% in 2008

America's Research Group, a consumer research firm, lowered its 2008 holiday retail sales forecast. ARG now believes retail sales will fall 3.5 percent from last year. Previously, ARG predicted just a 1 percent decline.

Chief Executive Britt Beemer told the New York Times, "When you look at the numbers, you see that over the weekend consumers were frugal and focused, staying within their budgets and concentrating on the deals and advertised specials."

Nineteen percent of the shoppers surveyed by ARG said they had already finished 90 percent of their shopping. That's up from 13.6 percent last year. About 63 percent of people polled said that they would finish their shopping in three days or less. That leaves retailers with the prospect of sluggish sales between now and the end of December when many retailers look for holiday sales to get them back into the black.

Beemer told that Times that shoppers were disciplined. They made lists and stuck to them. He found that 70.2 percent of shoppers told him that they stayed within budgets.