On November 28, 2020, a person with a shopping bag is wearing a face mask at Columbus Circle, New York City.
Noamgarai | Getty Images
Shoppers have shown a willingness to invest in new clothing, electronics and jewelery in recent months. Retail analysts are confident that it will spice up the holiday season.
Holiday forecasts from three different companies predict year-over-year spending spikes. According to Bain, sales in November and December are expected to reach $ 800 billion, up 7% from a year ago. Deloitte expects holiday retail sales to increase by 7% to 9%, compared to the 5.8% increase tracked in 2020. According to MastercardSpendingPulse forecasts, Holiday Retail Sales should increase 7.4% year-on-year and 11.1% on a two-year basis. , Supported by in-store shopping recovery and sustained consumer demand.
Retailers have repeated similar expectations. Home Depot, For example, said it Sold out with early release of Halloween decorations — An indicator that shoppers may also have a great desire for Christmas decorations.
Dick’s sporting goods On Monday, he said he would hire employees for the most seasons in the company’s history during the 2021 holiday season.
Walmart CEO Doug McMillon said the pandemic might inspire families to look forward to their vacation even more.Large-scale retail store said it earlier this month Employ 20,000 supply chain employeesMeet the demand after the busy shopping season, such as freight handlers and lift drivers.
“Customers and families want to celebrate Christmas,” McMillon said at a virtual conference hosted by Goldman Sachs. “They want Thanksgiving. If this situation of the virus makes it possible, or if it doesn’t, there will be strong demand throughout the rest of the year.”
Get an early look at what shoppers and retailers may see during this holiday season, based on interviews with CNBC retail analysts and comments from industry executives.
Industry-wide supply chain challenges, such as factory closures, chip shortages, and port congestion, are expected to continue from vacation to next year.
Pressure can ruin the holiday season for families who don’t shop fast enough. Many stages of the manufacturing and delivery process take longer than usual.For consumers, the following delivery companies ups When FedEx Solve your own bottleneck.
Meanwhile, businesses are trying to get enough products to meet the expected rising demand for holidays. Most categories of products, from home appliances to toys to sneakers, are somehow affected.
Gap cChief Financial Officer Katrina O’Connell told Goldman Sachs’ global retail conference Thursday that apparel companies expect supply chain problems to continue into 2022.
“We will do our best to place the unit here as soon as possible,” she said. “Inventory may be rugged.”
Salesforce predicts that the cost of products sold to US retailers will increase by more than $ 223 billion. The holiday season from a year ago due to soaring fares, manufacturing costs, and labor costs.
Retailers want to quickly move goods from a port to a store or a customer’s home, which can be difficult if there aren’t enough people. Aaron Cheris, head of retail at Bain America, said tight labor markets were the number one factor in monitoring this holiday season.
There is About 10 million jobs in the U.S.According to data from the Ministry of Labor and Indeed, there are about one million more people than the unemployed in the United States. Millions of workers Childcare issues Insufficient skills required.
Throughout the supply chain, companies trying to limit out-of-stocks and shorten delivery times will grow thinly, Cheris said. This means that if shoppers insist on delivering goods or have tight schedules, they will be in a difficult situation.
Employees outside Clifton, NJ
Adam Jeffrey | CNBC
“For the last-minute purchases you really wanted before Christmas, would you care if you were told that the delivery time was 8 days and 3 days before Christmas?” “They may say,’Forget, I don’t care.'”
He said retailers would also miss it if they didn’t have a sales person to find and suggest products and didn’t ensure that popular purchases were quickly replenished in the aisles.
If you’re looking for bargains or high-demand items this holiday season, it’s a good idea to shop early.
As supply chain snuffs tighten inventories, companies have less reason to sell their products. Instead, retailers may strategically place promotions on products that are overstocked. And it may not be anything on your list of holiday wishes.
“There’s always sales, but it won’t be that deep and abundant,” Cheris said. “As a retailer or brand, I don’t have the same motivation when I know it’s going out of stock.”
Transactions begin and close early, according to Deloitte, Vice Chairman of US Retail and Distribution Rodside. He expects many consumer holiday shopping to begin before this year’s Thanksgiving and end weeks earlier than usual. Days like Black Friday can be less important, he said. Shoppers expect to have to pay for certain coveted toys and game consoles, regardless of the luxury of the transaction.
“Consumers have awakened to some supply chain challenges,” Sides said. “There are certain categories that retailers have enough inventories, and there are other categories that aren’t … people want to buy, and they will be a big challenge.”
Many retailers including Macy’s And Dick’s sporting goods, have They reported higher profits because they made fewer promotions.
At the Goldman meeting, Macy’s Chief Financial Officer Adrian Mitchell said price cuts this year were below historical levels, partly due to rising costs due to inflation.
Macy’s said he wasn’t too worried about having enough jewelry, cosmet items and household items in stock during the holidays. However, due to procurement constraints, we are becoming more cautious about apparel and footwear.
Shoppers are expected to get off the couch and return to the mall, analysts said. It boosts spending because people are more likely to make impulse purchases when shopping directly. This is a major reversal from last year when the pandemic prompted a move to e-commerce.
Mastercard Spending Pulse’s year-end and New Year forecasts, based on total sales on Mastercard’s payment network, show sales at stores excluding automobiles and petrol up 6.6% year-on-year.
Steve Sadove, Mastercard’s senior advisor and former Saks CEO, said luxury goods and jewelery are the top two categories that bring people back to the store.
“Demand is stagnant, savings are high, the stock market is very strong, and consumers want to go out and shop,” Sadobe said in an interview with CNBC on Monday. .. Courtney Reagan.. “Consumers want to go back to the mall.”
According to Mastercard SpendingPulse, apparel sales are expected to increase 46% from November 1st to December 24th compared to the previous year’s vacation period, both in-store and online. Jewelery sales are projected to surge 59%. According to Mastercard, sales of luxury goods, excluding jewelery, are projected to grow by a whopping 93%.
Hurricane “Aida” flooded the house and damaged the car. AccuWeather estimates the storm that has occurred Damages of over $ 95 billion, This caused the seventh most expensive hurricane since 2000 to hit the United States.
For some families, the extreme damage means thousands of dollars of unplanned costs, from roof repairs to washing machine and dryer replacements.In the short term, this purchase will bring you home depots and Loews, Or an appliance seller like Best buy.. However, Bain’s Cheris warns that it could break the holiday gift budget.
“It’s another place where my dollars go where they wouldn’t normally go,” he said.
Shoppers may also spend money on other channels, such as traveling and booking hotel rooms at higher rates, he said. Travel websites and hotels have a fast pace of booking December was strong, often above 2019 levels. People are planning far in advance, which can push up the prices of starters. Increased travel spending can mean less money for tangible items.
According to Bain’s Holiday Report, shoppers are likely to face headaches such as being unable to find items, delays in delivery over weeks, and unmanned cashiers, shaping their feelings towards retailers. prize.
Cheris said companies must find ways to turn around their frustrating or disappointed experiences so that they don’t lose their customers forever. You can also try to anticipate those moments to slow down the impact, such as expanding the delivery window to leave buffer time for alternative items to suggest if popular items aren’t available. increase.
“They are like really important moments of truth,” he said. “They are emotional moments that it makes a big difference if you can find a way to make them better.”
Initial forecasts require transaction reductions and delays
Source link Initial forecasts require transaction reductions and delays