Retailers are expected to usher in the unofficial start to the holiday shopping season Friday with bigger crowds than last year in a closer step toward normalcy. But the fallout from the pandemic continues to weigh on businesses and shoppers’ minds.
Buoyed by substantial hiring, healthy pay gains and substantial savings, customers are returning to stores and splurging on all types of items. But the spike has also resulted in limited selection across the board as suppliers and retailers have been caught flat-footed.
Shortages of shipping containers and truckers have helped to delay deliveries while inflation continues to crawl. The combination of not finding the right item at the right price — in addition to a labor shortage that makes it more difficult for businesses to respond to customer needs — could make for a less festive mood.
Shoppers are expected to pay on average of between 5% to 17% more for toys, clothing, appliances, TVs and others purchases on Black Friday this year compared with last year, according to Aurelien Duthoit, senior sector advisor at Allianz Research. TVs will see the highest price hike on average, up 17% from a year ago, according to the research firm. That’s because at any rate discounts obtainable will be applied to goods that are already expensive.
“I think it is going to be a messy holiday season,” said Neil Saunders, managing director at GlobalData Retail. ”It will be a bit frustrating for retailers, consumers and the workers. We are going to see long lines. We are going to see messier stores. We are going to see delays as you collect online orders.”
For years, Black Friday has been losing importance. Since 2011, stores jumpstarted the holiday shopping season by opening their doors on Thanksgiving to compete with Amazon and other rising online threats. But the shift merely cannibalized Black Friday sales. The shopping bonanza was further diluted when stores started marketing Black Friday sales for the complete week and then later for the month.
See how delays in the supply chain are causing problems for the toys you plan to buy this holiday season.
The pandemic further reduced the importance of the Black Friday event, though some experts nevertheless believe it will again be the busiest day of the year. Last year, retailers started to offer the big holiday sales earlier in October in an effort to spread out shopping for safety reasons and to smooth out online shipping peaks. They also got rid of the Thanksgiving Day in-store shopping event and pushed all their discounts online. This year, retailers are embracing a similar strategy, though they are now pushing holiday discounts in stores in addition.
Despite all the challenges, experts believe that sales for the Thanksgiving week and overall season will be strong.
U.S. retail sales, excluding auto and gas, from this past Monday by Sunday are expected to increase 10% from last year and 12.2% from the 2019 holiday season, according to Mastercard SpendingPulse, which measures overall retail sales across all payment types including cash and check.
How did Black Friday become America’s biggest shopping day of the year? It may surprise you to learn that the way it started had nothing to do with shopping at all. NBCLX’s Janine Doyon traced the history of Black Friday from its origins in 1960 to the nearly week-long celebration of consumerism it is today.
Online sales are forecast to increase 7.1% for that week, a slowdown from the enormous 46.4% gain in the same period a year ago when shoppers collectively pivoted to the internet instead of shopping in person, according to Mastercard. For the overall holiday season, online sales should increase 10% from a year ago, compared with a 33% increase last year, according to Adobe Digital Economy Index.
Sales on Black Friday are expected to surge 20% from a year ago as store traffic comes back.
For the November and December period, the National Retail Federation, the nation’s largest retail trade group, predicts that sales will increase between 8.5% and 10.5%. Holiday sales increased 8.2% in 2020 when shoppers, locked down during the early part of the pandemic, spent their money on pajamas and home goods.
GlobalGiving is a nonprofit that connects other nonprofits to donors and companies and offers gift cards to give a charitable donation on someone’s behalf during the holidays.
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