Only 330 gifts had been put under the tree in the Dunedin store so far, "way down" on the 1000 that had been received at the corresponding time last year, organiser Dawn Barnes said yesterday.
Nationally, the appeal was down 10%.
"We are all expecting it to be tougher this year for everyone."
The annual appeal collects gifts which are distributed by the Salvation Army and Barnardos to less fortunate families at Christmas.
Many families relied on donated gifts at this time of the year but, because many people were tightening their belts, the appeal was not expected to be as successful as in previous years, she said.
The store hoped to receive 1000 gifts by Christmas Eve, but she said it was grateful for everything it received.
In 2007, 23,000 gifts were collected nationally, 1700 of them from Dunedin.