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Port problems could cause holiday shortages, discounts

Associated Press

NEW YORK -- Hot toys like radio-controlled cars and the latest fur-trimmed sweaters may be in short supply this holiday -- but the West Coast port shutdown may also produce some big discounts.

The shutdown, which ended Wednesday as longshoreman and shipping companies complied with a judge's order to resume operations, stranded mountains of merchandise at port and aboard ships, and left retailers with a logistical nightmare.

Even with the 29 West Coast ports back in business, a leading retail industry group expects it will take four to six weeks to get goods into stores -- a month late and barely in time for Thanksgiving.

That means merchants may be forced to cancel reorders on certain goods that won't arrive on time. And that could leave them short, analysts said.

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On the other hand, stores may be forced to mark down goods more heavily and sooner if everything arrives at once -- or too late.

While a prolonged lockout would have had a much more disastrous effect on holiday sales, the 10-day shutdown was long enough to deal yet another blow to retailers, which are already facing a rocky season as economic and political uncertainties mount.

"It was already supposed to be a slow start to the Christmas season," said Steve Skinner, partner in the retail practice at the consulting firm Accenture. "Now, we may have a shorter Christmas season. There will be more pressure from retailers to discount even sooner."

This year, with Thanksgiving falling on Nov. 28, the holiday shopping season has six fewer days than last year.

Skinner believes that shoppers might see some bare shelves around Halloween -- just when the batch of holiday shipments were supposed to arrive.

In anticipation of the shutdown, many stores, including Wal-Mart Stores Inc., began contingency efforts early this summer, sending what they expected would be their most important holiday items by air freight or diverting goods to the East Coast ports.

Now, the problem is getting those goods that were shipped through Pacific ports moved along to stores, uncrated and on the shelves.

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