Holiday shopping not affected by supply chain woes
Parents with pitchforks have not stormed Amazon fulfillment centers in search of that special Christmas gift for their beloveds, despite widespread media hype around supply chain problems.
At least not yet. The next four days will tell the tale.
Half of all Americans plan to shop online over the next four days, according to Numerator, a retail and marketing data analysis firm. Half of those sales will happen on Amazon, the company predicts.
“Almost 1 in 4 consumers (24 percent) say they plan to spend more this Cyber Weekend than in previous years, while 12 percent say they will spend less,” Numerator's researchers reported.
Forty-nine percent of Americans will shop in stores for Small Business Saturday, according to a poll by Lendingtree, the online finance company. More than 60 percent of shoppers said the pandemic made them more loyal to local businesses, and nearly as many believe Amazon hurts small shopkeepers.
“Many of these local businesses were in real danger during the pandemic, in large part because they didn't have the resources that large national chains had to ride out the storm,” chief credit analyst Matt Schulz said. “Many didn't make it, and that's a real shame.”
Pundits have squawked quite a bit about inflation lately, but so far, consumer spirit is undampened. They've boosted spending over the last three months, and they seem intent to keep their wallets open through the holidays.
Retail sales rose 1.7 percent in October, and JP Morgan raised its fourth-quarter economic growth forecast from 4 percent to 5 percent, a blistering and unsustainable pace, yet good news for retail. But will consumers find what they want?
If you are looking for the latest, most popular items made overseas, you will struggle if you haven’t bought the item already. Anything involving a computer chip, especially a Playstation 5 or a high-speed laptop, may be difficult to acquire. But so far, shortages are more anticipated than real.
Fred Hajjar, owner of Uglychristmassweater.com, told USA Today he’s running low on some styles, but he’s nowhere near running out. CEOS at Walmart, Target, TJ Maxx and other major outlets have reassured investors they have plenty of inventory to sell.
Fortunately, this year, there are no faddish, must-have toys, and most consumers have heard enough about supply chain problems to adjust their expectations. And if you are buying U.s.-made products, you are far more likely to score.
The Alliance for American Manufacturing has a helpful state-by-state guide for the patriotic shopper. U.S. clothing and shoemakers are revolutionizing the industry across the country with exceptional designs at a time when factories in Asia have slowed down production due to COVID-19.
Realsteel in Pasadena, which makes metal cut-out signs, decorations and yard art for all occasions, is a homegrown Texas company. Weatherford-based Buffalo Wool Company offers American-made socks, gloves, hats, knitwear, footwear made from bison wool and leather.
What you will not find this year are significant discounts or sales, at least not until the New Year. Retailers are not so flush that they worried about overstock.
The genuine shortage retailers are facing is labor.
About 1.4 million workers between the ages of 25 and 54 have left the workforce since the onset of the COVID-19 pandemic, according to S&P Global Ratings, a financial data firm. That’s driven up wages and shaved 1 percent off annual U.S. economic growth.
“We estimate that about 42 percent of the 3 million people who left the workforce since February 2020 are permanent, largely tied to retirement, while 58 percent are shorter-term, pandemic-specific decisions to leave the market,” chief economist Beth Ann Bovino said.
Two-thirds of small businesses and more than 60 percent of retailers said they had a “very difficult” time finding the right employees to fill open roles, according to a survey by Alignable, a small business referral website.
The good news is that logistics experts expect backlogs at U.S. ports and trucker shortages to ease next year. As more Americans get vaccinated, and fear of infection reduces, more people will reenter the workforce, and wage inflation will slow.
Core inflation, which excludes energy and food prices, will not look as bad on a year-over-year basis next year. And if retailers did overstock this season, the January sales will be fabulous. But the economic impact of the pandemic will end only when all of these things return to normal.
Until then, consider the 2021 holidays just another COVID Christmas with a twist that requires another season of adjustments. With any luck, the virus will give up its hold on the economy and our holidays next year.