Shoppers may become combatants in tablet wars

With demand for the devices expected to outpace inventories, consumers could be left empty-handed.

By InvestorPlace Sep 20, 2012 12:57PM
Image, Gifts, copyright Image Source Black, JupiterimagesBy Alyssa Oursler

iplogoIf you think the looming tablet wars are only for tablet makers, think again.

Yes, Microsoft's (MSFT) Surface, Apple's (AAPL) iPad, Amazon's (AMZN) Kindle Fire and the recently added Tabeao from Toys R Us -- which is owned by Vornado Realty Trust (VNO) -- are all competing for attention as the holiday shopping season rolls around.

But when consumers finally make it to the many retailers selling these hot gadgets, they may find themselves duking it out, as inventories of the increasingly popular tablets may not keep up with the seasonal demand.

Consulting firm BDO recently released a survey showing that only 25% of retail CFOs are increasing the amount of merchandise they purchase for the holidays, leaving many parents concerned that they won't be able to fulfill their children's Christmas wishes.

And while retailers do want to please their customers, upping inventory too much could prompt stores to make big post-holiday price cuts, which would carve into their bottom line.

Instead, stores are trying other tactics. Toys R Us is soothing shoppers' worries by letting them "reserve" around 65 of the hottest gadgets, including its new tablet and the Leapfrog 2 tablet, anytime before Halloween, USA Today reports.

Other stores, like Wal-Mart (WMT) and Sears Holdings' (SHLD) Kmart, offer layaway -- sometimes without any fees -- as well.

In the end, retailers still want shoppers clamoring for their products. In fact, the expected tablet demand could help this holiday season be the cherry on top of an already improving sector.

Plus, while the period between Black Friday and Christmas is always a bright spot for retailers, this season it's even brighter. The period is a whopping 32 days, giving shoppers two extra weekends to shop and hopefully spend more.

If consumers are tempted to wait until the last minute, thanks to all that extra time, though, they might just find empty shelves instead of the cool new tablet computer they were hoping to snag.

(Microsoft owns and publishes Top Stocks, an MSN Money site.)

As of this writing, Alyssa Oursler did not own a position in any of the aforementioned securities.

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