September results suggest weak Halloween and Holidays.

Same-store sales growth weakened to 1.3% in September as shoppers gave new signs of the extent they plan to cut back for Halloween and the holidays, TNS Retail Forward reports.

September’s result for about 40 retailers reporting monthly sales is down from a 2.0% sales-weighted composite reported last month and the same as the 1.3% composite reported in September of 2007.

“These latest signs from retailers and shoppers are leaving little doubt that the coming months will be the weakest spending environment that the U.S. economy has faced in at least 17 years,” said Frank Badillo, Senior Economist at TNS Retail Forward.

September’s results were led by stronger than average results at Warehouse Clubs and Drug Stores. Department Stores and Apparel and Accessory Stores saw steep declines. Discount Department Store managed slight combined growth. Although TNS Retail Forward’s ShopperScape survey polled shoppers before the financial crisis deteriorated at the end of September, the survey nevertheless shows that shoppers are stepping up their plans to cut back on spending for Halloween and the holidays:

* The percentage of shoppers planning to spend less on Halloween this year (29%) is significantly higher than 2007 (21%) and 2006 (17%).

* Up Market shoppers are most likely to plan to spend on Halloween and are most likely to spend the same or more than last year.

Shoppers’ plans to cut back spending are even more dramatic for the holidays, according to the ShopperScape survey.

* Nearly 4 of every 10 shoppers (37%) plan to spend less on the holiday than they did last year. That represents an increase of 10 percentage points.

* The planned spending cuts are skewed toward Down and Middle Market shoppers—38% or more of them plan to spend less on the holiday compared with 32% of Up Market shoppers.

* Only 13% of shoppers plan to spend more than last year. Surprisingly, that represents a slight increase from last year.

The spending cutbacks planned by shoppers are skewed toward holiday trimmings while gifts for immediate family are somewhat safer, according to the Shopperscape survey.

* Among the least vulnerable to holiday cutbacks will be gifts for children and spouses/partners. Slightly less than one-fifth of shoppers plan to cut back in each of those cases.

* Shoppers are also least likely to cut back on gifts for their pets—although shoppers who buy holiday gifts for their pets are in the minority (43%).

* Most vulnerable to holiday cutbacks is spending on gift wrapping supplies (including bags, tags and ribbon), indoor decorations and Christmas tree ornaments.

* Gifts for friends and relatives outside the immediate family are also likely targets for less spending by households.

* Social activities such as holiday travel, hosting parties and sending holiday greetings cards also are likely to be more modest this year.

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