Advertisement
Share

Good luck finding Black Friday deals. Blame supply chain chaos and strong demand

A woman walks in front of a mall store window advertising 40% off everything
Big Black Friday discounts, like these last year at the Glendale Galleria, may be difficult to find because of supply chain problems and high demand.
(Dania Maxwell / Los Angeles Times)

Holiday shoppers, beware: Black Friday deals are shaping up to be underwhelming.

Seasonal discounts on electronics, sporting goods and appliances are all significantly shallower than last year, according to Adobe Inc., amid tight inventories, robust consumer spending and rising inflation. The tools and home improvement category is even less appealing so far with no holiday bargains at all on balance, based on Adobe’s comparison of online price changes in 2020 and 2021 between Oct. 1 and Nov. 6.

“You’re not going to find your typical Black Friday deals,” said Gabriella Santaniello, founder of retail consultant A-Line Partners. “There’s not enough inventory in the channel for anybody to be significantly promotional. You can just kiss that goodbye.”

During the pandemic, retailers have discounted less because supply-chain issues lowered inventories. And now in its most important shopping season, the industry is betting that it can offset inflation with fewer deals while not hurting demand.

Advertisement

The risk with this strategy is that consumers don’t spend as much amid lackluster promotions and a rise in out-of-stock goods. In October, online shoppers saw more than 2 billion out-of-stock messages, Adobe said. That’s up 250% from the previous October and a 325% increase from October 2019.

Buy Nothing Project group members may be among the few who aren’t worried about supply chain problems leading to issues with gifts this holiday season.

“This will probably be one of the least promotional periods you’ve seen in some time,” said Brian Yarbrough, a retail analyst at Edward Jones. “You’ve got the inventory issues, and you’ve got a demand picture that’s one of the strongest in many years. Even with a lot of these deals, it’s not these margin killers they used to be.”

Of course, dedicated shoppers will still find bargains online and in stores, both before and after the U.S. celebrates Thanksgiving on Thursday. Retailers have trained consumers to expect seasonal deals, and many companies will be afraid of losing market share without a few sweeteners to entice shoppers.

“If you had a sale last year, it’s pretty risky not to do it again,” said Marshal Cohen, chief industry advisor at researcher NPD Group. “What’s the difference this year? It’s not going to last as long.”

Like last year, retailers have started seasonal promotions early, and the internet is abuzz with holiday shopping tips. Discounts are deeper than last year in computers and toys, and in line with 2020 levels in televisions and furniture, Adobe said.

Walmart Inc. is reprising a monthlong sales event from last year called Black Friday Deals for Days, touting special prices on air fryers, televisions, Lego sets and trampolines. Amazon.com and other shopping websites are trumpeting discounts on similar goods.

Buy Nothing groups are easier to find and join than ever. But there are rules and ethics and etiquette to consider.

Target Corp. kicked off “early Black Friday savings” on Oct. 31 with discounts on such items as wireless headphones, laptops and coffee makers. The company will offer new deals each week advertised as “Holiday Best,” denoting the lowest planned price for the holiday season.

Best Buy Co. is showcasing offerings from Apple Inc. AirPods to a cordless vacuum cleaner. The company started additional promotions Nov. 19, a week before traditional Black Friday.

Beyond the headlines and glowing press releases, however, the retail industry is eyeing a holiday season with smaller price cuts.

“Retailers aren’t just going to give it away,” Santaniello said. “They may advertise it as a deal, but it’s not going to be anywhere close to satisfying” for shoppers.

Against a backdrop in which “there aren’t any discounts” at big retailers, smaller companies and resellers such as ThredUp Inc. can be less aggressive with pricing as well, Chief Executive James Reinhart said. The seller of used apparel is seeing healthy demand for its cocktail dresses and handbags, which can typically be had for less than new, name-brand goods.

“Historically, you had to be so promotional around the holiday to just kind of compete with how aggressively the big retail giants were discounting,” Reinhart said. “Now that they’re discounting less, it allows us to discount a little less.”


Advertisement