Will supply chain issues cause problems for Black Friday?

There is only one curtain puller that is louder and longer lasting than the children’s Christmas countdown: Londonshop Scream Black Friday in your inbox.

The annual claim that you will never find a specific scent again Candle, The extra-large TV or nose trimmer at this price — commonly known as Black Friday — took place on November 26.

But in the supply crisis, mixed feelings result From Retailer Significant price cuts to boost Christmas Eve Sales volume, Analysts warned that the Black Friday trend may weaken.

Amazon has only recently embedded this tradition here, and it was quickly copied by British retail chains from John Lewis to Curry.

“Black Friday came to the UK from the US like a tornado, and it takes a while for people to understand it,” said Clive Black, a retail analyst at Shore Capital. “For some people, this is an opportunity to promote sales in a timely manner, perhaps to clear some inventory or gain some popularity and market share.

“For others, this is a nightmare, it brings traditionally higher profit margins, full-price discount sales-but also put pressure on the supply chain, leading to a general decline.”

Bhavik Master, owner of the British knitwear brand Paul James, agrees. His company rejected Black Friday this year.

“We don’t believe in deep discount strategies,” he explained. “We believe in pricing our knitwear fairly from the beginning so that our customers can shop when they really need to buy—— [Black Friday] This has led to the prosperity and depression experienced by many brands because it is not a sustainable business model. ”

Among the major retailers, Marks and Spencer and Next are among the retailers that withdrew from Black Friday promotions this year.

Shoppers’ interest may also be waning: According to GlobalData’s analysis, last year, the number of UK shoppers buying Black Friday deals fell by 6% compared to 2019.

Patrick O’Brien, GlobalData UK Retail Research Director, predicts that due to supply chain issues, more stores will decide not to participate this year.

“We don’t think this year’s Black Friday will be as grand as it was before the pandemic,” he said. “The inventory problems encountered by many retailers mean that they have less excess inventory to transfer, and prices are generally rising.

“However, this is still an important event for retailers. As long as the big guys take it seriously and offer big discounts, then small retailers have no choice but to participate.

“Of course, the problem is that it would be better for retailers to ignore Black Friday altogether, because it will erode profit margins when people are ready to consume, but the competitive impulse of larger players makes this impossible.”

Nicola Parker, director of online dental product store Withasmile, admitted that she felt “stressed” to join Black Friday, even though it touched the bottom line.

“As a small business, we found that Black Friday was paradoxical,” she said. “We believe that customers who have purchased during this period [the sale] In any case, it will be purchased at full price. On average, in the week before Black Friday, our sales dropped by about 50% as customers waited to save.

“But if we don’t offer Black Friday promotions, we may miss the business of other companies that offer promotions. This becomes a bidding war for who can provide the cheapest product.”

However, this is not just about what is going through at the cash register. Some SMEs see Black Friday as an important tool to protect customer data and loyalty.

“Black Friday is an important period of the year to acquire customers,” said Oliver Mennell, founder and CEO of luxury candle retailer Neom. Compared with 2019, the company’s discount day last year Sales have more than doubled.

“For us, it’s all about introducing new customers to our brand and encouraging them to continue shopping with us in the weeks before and after Christmas.”

This may come at a high price. Carolina Paradas-Mandato, head of strategic partnerships for the loyalty app Swapi, said: “Regardless of traffic and customer intent, Black Friday is an extremely expensive marketing strategy. Retail A business may find that he has sacrificed profit margins and instead sees losses.

“For most people, this is a batch game, so for SMEs, it is an adventure time to keep up with the trend. In addition, it is difficult to participate in these activities only once. Customers are accustomed to discounts.”

As we enter mid-November, the inbox of the average online shopper will still scream “Black Friday” more frequently than during self-checkout in the bagging area. However, as SMEs and large chain stores are expanding their influence, this phenomenon may be disappearing.

“It may be a bit premature to announce the end of Black Friday, but we have passed the peak period-most homes, businesses and the environment have become better because of this,” Black asserted. “Many shoppers suspect that Black Friday is usually a manipulation, selling them things they don’t want, usually tat, and therefore does not represent value for money.

“For SMEs, Black Friday can help them improve their financial performance, but only if it is in the real interests of shoppers and businesses. In recent years, it has become more and more important.”