Mark Elward, CCO of Huboo, shares a preview of what retailers and ecommerce merchants can expect from Black Friday challenges:
As a fulfilment technology provider with 1,400 clients across the UK, Netherlands and Spain, our customers are taking a mixed approach to Black Friday, bespoke to their business model and demands. It’s not sector specific – a myriad of factors come into play when deciding which sales occasions should be brought to fruition – but I expect supply issues will play a large part in that process.
Sales spikes are diluted in the digital age as a result of online voucher codes and social media promotions, as well as the sheer volume of sales occasions dotted throughout the year. Retailers traditionally structured discounts around three or four key seasonal sales periods, but that model is long gone. However, large players like Next and M&S are shunning Black Friday this year. Next, in particular, still places huge emphasis on its very popular Boxing Day sale which allows it to enjoy a Christmas sales peak throughout December, followed by another rush as the year ends.
Supply chain and labour shortages In short will both have a significant impact on Black Friday sales this year. For UK retailers and ecommerce businesses importing goods from China, real challenges are still at play. Ocean freight charges are currently around five times higher, so what was costing around $3,000 is now more like $15,000. It’s no surprise then that the increase will have to be passed on to the consumer and delays can be expected due to the weakened supply chain.
The other issue we’re seeing is that haulage firms are still facing staff shortages, which are continuing to pose huge problems. In the worst case scenario, trailers of stock are left waiting to be collected meaning next day deliveries are returning to luxury status as opposed to what had become the norm. Lastly, product offerings are reduced so choice will be less than in previous years, much like the way consumers are now frustratingly au fait with at grocery stores.