During Black Friday sales this year, those wanting to score attractive discounts on holiday items may strike it fortunate. However, waiting can make you luckier. Concerned that the shortages of the previous year would occur again, businesses stocked up well on clothing, toys, and other items in advance of the holidays. Concerned that they misjudged demand from consumers struggling with the growing cost of living, they are now lowering prices.
Sales events have already been going on for a few weeks, but analysts predict that as Christmas Day gets closer and businesses are under pressure to move inventory off their shelves, the discounts may get much deeper. What a world of difference, exclaimed Dana Telsey, CEO of consumer-focused trading and consulting business Telsey Advisory Group.
“Last year, everything was selling for full price because there wasn’t enough inventory. This year, there is an excessive amount of goods and promotions, which will only get bigger as Christmas approaches.
If consumers have the means to spend, the news is excellent.
Globally, there isn’t quite as much holiday cheer in the air as there should be. According to a survey conducted by consulting firm BCG in nine nations, including the UK, Australia, France, and Germany, only Americans planned to spend more this year than they did last year.
That is consistent with pessimistic predictions from major worldwide retailers like Amazon, which has cautioned that holiday sales are probably going to be sluggish, particularly in its overseas sector. Expectations for sales are being dampened by this, especially in the US, where consumer spending, the major engine of the economy, has performed better than anticipated this year. Similar to their forecast for the entire year, the US National Retail Federation anticipates that sales in November and December will increase by 6% to 8% from the previous year.
In comparison to 2021, when sales increased by more than 13% but remained above the 10-year average, this represents a severe decrease. Neil Saunders, managing director of the GlobalData consultancy, however, predicted that price rises rather than a rise in the volume of goods sold will account for a large portion of the sales gain in the US. “Retail is flashing a lot of caution lights, but consumers have been remarkably robust. How long will they continue to be resilient is the question, he said. Everyone in retail, I believe, is holding their breath because it is still up in the air.
The day after Thanksgiving, when many Americans have the day off, is known as Black Friday. On this day, shops typically give discounts to encourage customers to purchase, kicking off the busiest shopping day of the year. In the past ten years or so, the sales event has become a global phenomenon thanks to US retail giants like Apple, Amazon, and Walmart who pioneered it. Local stores throughout the world have now adapted the sales event in an effort to compete. Black Friday used to be known for its crush of shoppers, but as internet discounts being applied earlier and earlier, it has seen its hold on the shopping season diminish in recent years.
Due to early-October sales events, many consumers have already made purchases this year. The National Retail Federation continues to predict that this weekend’s sales will surpass the peak of two years ago. However, as the economy weakens and prices for groceries and other necessities rise, early shopping enhances the possibility that consumer demand may decline substantially in December. According to Mr. Saunders, even steeper discounts may come if demand declines dramatically. Some shops are already planning for that eventuality. Target, for example, assured customers in October that it would refund any price reductions made closer to Christmas.
This Black Friday is lot more circumspect, according to Mr. Saunders. “That’s a really significant departure from last year, when people were pampering themselves and overindulging, without a doubt.”
Given the steep price increases that have impacted wallets over the previous two years, customers might not be overjoyed despite the discounts, according to writer Catherine Brock, who has been blogging under the moniker “Budget Fashionista” since 2014. Despite a decline in US inflation since June, prices continued to rise in the year that ended in October, gaining 7.7%. Although there are some fantastic fashion and beauty offers available, she remarked, “I’m not sure whether it makes up for what’s been happening with the groceries and the petrol.”
“I believe it helps a little bit, but I don’t think it compensates it,” the sister said, “being able to buy a sweater for Christmas for $20 instead of $30.”
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