Local retailers expect larger crowds on Black Friday, but pandemic problems persist

Retailers are expected to herald the unofficial start of the Christmas shopping season on Friday with larger crowds than last year in a closer step towards normality. But the fallout from the pandemic continues to weigh on the minds of businesses and shoppers.

Carried by solid employment, healthy wage gains and significant savings, customers return to the stores and spill out with all types of goods. But the increase has also resulted in limited selection across the board, as suppliers and retailers have been caught on flat foot.

Lack of containers and lorries has contributed to delays in deliveries, while inflation continues to creep. The combination of not finding the right product at the right price – in addition to a lack of manpower that makes it harder for companies to respond to customer needs – could create a less festive atmosphere.

Shoppers are expected to pay on average between 5% and 17% more for purchases of toys, clothing, appliances, TVs and other purchases on Black Friday this year compared to last year, according to Aurelien Duthoit, senior sector consultant at Allianz Research. TVs will experience the highest price increase on average, an increase of 17% from a year ago, according to the research firm. This is because the available discounts will be applied to items that are already expensive.

“I think it’s going to be a messy holiday season,” said Neil Saunders, CEO of GlobalData Retail. “It will be a little frustrating for retailers, consumers and workers. We’re going to see long queues. We’ll get to see more cluttered stores. We’ll see delays when you collect online orders. “

For years, Black Friday has been losing significance. Since 2011, stores have kicked off the Christmas shopping season by opening their doors on Thanksgiving to compete with Amazon and other rising online threats. But the shift just cannibalized Black Friday sales. The shopping bonanza was further diluted as stores began marketing Black Friday sales for the entire week and then later for the month.

The pandemic further diminished the significance of the Black Friday event, although some experts still believe it will again be the busiest day of the year. Last year, retailers began offering the big holiday sales earlier in October in an effort to diversify purchases for security reasons and to smooth out peak loads online. They also got rid of Thanksgiving Day at the store’s shopping event and squeezed all their discounts online. This year, retailers are embracing a similar strategy, though they are now also pushing holiday discounts in stores.

Despite all the challenges, experts believe that sales for Thanksgiving week and the overall season will be strong.

U.S. retail sales, excluding cars and gas, are expected to increase 10% from last year and 12.2% from the 2019 holiday season, according to Mastercard SpendingPulse, which measures total retail sales across all payment types, including cash and checks.

Online sales are expected to rise by 7.1% for the week, a slowdown from the massive increase of 46.4% over the same period a year ago, when customers collectively switched to the internet instead of shopping in person, according to Mastercard. For the total holiday season, online sales were to increase 10% from a year ago, compared to a 33% increase last year, according to the Adobe Digital Economy Index.

Sales on Black Friday are expected to increase by 20% from a year ago, when store traffic returns.

For the period November and December, the National Retail Federation, the country’s largest retail group, predicts that sales will increase between 8.5% and 10.5%. Holiday sales rose 8.2% in 2020 as shoppers locked in during the early part of the pandemic spent their money on pajamas and household items.

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