Shoppers have many reasons to look forward to this holiday shopping season as retailers gear up to offer serious discounts.
As the summer season is wrapping up, many consumers are looking forward to pumpkin spice everything and the beginning of the holiday shopping season. With only 85 days until the Friday after Thanksgiving, commonly referred to as “black friday” or the kick-off of winter seasonal shopping for many. Most retailers are announcing this year consumers can expect far more discounts than in previous holiday shopping seasons. Consumers can look for major promotions on not just toys but reduced prices on electronics, beauty products, sporting goods, and clothing.
CNN Business is reporting that many retailers are facing issues with too much backstock inventory and are planning on increasing promotions as they incorporate the stockpiled products into the holiday shopping season. These promotions are looking to dish out much-needed savings to consumers feeling overwhelmed by recent inflation costs. Major retail chains such as Walmart say they will be offering more “rollbacks” than in previous years and will be more focused on sales associated with toys to help with the holiday shopping season pinch. Consumers will see a wide range of inventory of items between $50 and $25 dollars. Best Buy, Gap, Ulta, and other big retailers are following suit with plans for a holiday shopping season jam-packed with sales and promotions to offset this year’s inflation costs. Ulta beauty finance chief Scott Settersten stated on last week’s earning call, “We expect it to be more competitive, more promotional this year than it was a year ago.”
Best Buy is feeling less of an impact from overstocked inventory. However, the retailer is bracing for competition during the holiday shopping season from other electronics companies that plan on slashing prices due to inventory backlog. Although retailers are already in the planning stages of what can be expected for consumers this holiday shopping season, they are predicting the rush will kick off later in the season than last year. Consumers are still feeling the impact of the rising costs of fuel, food, and housing expenses. Even though some of these costs have begun to drop, consumers are still on the fence as to what to expect next.
The challenge with the upcoming holiday shopping season and the planned promotions is on the shoulders of those retailers that are planning major reductions in pricing. Although these sales are great for consumers, the savings eat away at companies’ bottom lines. Not all retailers are planning on taking a price plunge on their back-stocked inventory. Retailers like Carter’s, Gap, and Kohl’s are planning on following a “pack and hold” strategy where their overstocked inventory will be placed in backrooms and held until next year when the products can be added to current fashion lines and sold at the original pricing.
Retailers still can’t say if the approach of these major discounts for the upcoming holiday shopping season will draw in consumers as anticipated. Consumers, especially those of lower-income family situations are focused more than ever on making purchases that are of necessity and not of discretionary goods. Statistics show that households with higher-income family situations are also making more cost-effective decisions regarding spending habits.