Already there are estimates that in the UK this year, Black Friday could witness sales exceeding £1bn – and that’s just online! Not much of this trickles down to individual retailers however, and very little of it ends up boosting your local economy. Most of this money will be made by large retailers, some of whom – as we know – have huge tax avoidance schemes in place. A great deal of the money spent by Brits this year will end up in the coffers of some extremely wealth shareholders, overseas.
What is Black Friday?
This year, Black Friday is on November 27th and you’ll find that most sales will start at midnight or at 8am. Increasingly retailers are starting sales even earlier, but there has been a backlash in the USA because Thanksgiving is the most important family holiday of the year and people believe it should hold to traditional values. People shouldn’t have to work on Thanksgiving.
Who makes the most?
The biggest players on Black Friday are online companies such as PC World/Currys and ASOS, as well as Amazon of course. Lovely tax avoiding Amazon, had orders for more than 5.5m goods on Black Friday last year, meaning that they were selling 64 items per second. Their Black Friday actually lasts all week and they announce daily deals and lightning deals on their phone app from Monday 23rd November.
It’s undeniable that shops are busy, too but they are largely city centre retailers who also have an online presence, and national and multi-national chains that can afford shops in shopping centres and large high streets. Springboard has predicted there will be an increase in footfall this Black Friday amounting to an 11.5pc rise on last year, but this will mainly be driven by a huge boost in visits to retail parks. SMEs rarely have a presence in these places.
As an SME can you be a part of the Black Friday Frenzy?
Well, yes you can. If you have a decent website that gets plenty of traffic you may well benefit. Similarly, if you sell goods on Amazon you should be alright too. EBay is expecting over 9 million of us to visit the website on Black Friday and it will be organising new deals every morning at 8 am between Monday November 23 and Monday November 30. The companies who will benefit from this is unclear, but let’s face it, it’s unlikely to be the small shops.
Black Friday PitfallsThere are a few things to watch out for as regards Black Friday this year. Firstly, increased sales and impulse purchases do tend to mean that there are lots of returns of unwanted goods. If you have to pay for that it can prove costly. It is expected that the returns alone could cost online sellers about £180m this year. Not bad if you run a delivery service but costly for sellers. Estimates suggest that between 25% and 40% of all goods purchased online in the UK are returned, including one in six electronic items and 30% of women’s fashion products. These returns are then unavailable for re-sale at a crucial time because they are tied up in the returns system.
Secondly, there is plenty of evidence that consumers only have a limited amount of money to spend, and spending it in November means that they will spend less an another time. Black Friday is hitting Boxing Day sales. Footfall in physical shops is expected to be 8.8pc lower on Boxing Day than it was last year, and many consumers increasingly stay at home and choose to shop online. Last year was the first time ever in the UK that Boxing Day was not the highest retail spending day of the year.
In fact, the Black Friday price-cutting frenzy has a huge impact on on-going sales. Last year even large department stores noticed that their sales volumes decreased by 4.5% over the month of December — the worst decline in sales since January 1996.
Possible Black Friday Backlash
Last year there were shameful scenes of chaos and greed as people stormed over each other to get into some large retailers. There were fist fights in the aisles and the whole thing was horrendously messy. Asda, who as part of US giant Walmart have a lot to answer for, have actually washed their hands of the whole affair this year and intend to keep prices down over the whole Christmas period. Jigsaw will not participate, while Argos, Primark, Oasis, John Lewis and Mothercare are also reigning in their participation. Argos will offer deals every Friday in November to try and spread out their sales, while John Lewis is sticking to its customer friendly offer of never being knowingly undersold.
What do you think?
Thumbs up or down for Black Friday? Do you do your shopping on Black Friday? Did you manage to make money last year? Tell us what you think. Come and visit us on Facebook or drop us a line below.