How short-lived bargains mean buying cheap can prove dear

Whether you like them or loathe them, the Christmas-themed retail sales events of Black Friday and Cyber Monday look to be here to stay. This year’s blitz kicks off again on Friday when retailers will offer time-limited bargains in an attempt to kick-start the festive sales. Along with the flood of emails enticing you with on-line offers, there will also be many in-store discounts.

High street retailers will be hoping to see a return to the frenzied in-store atmosphere of 2014 – affectionately known as “Black and Blue Friday”.

Last year £5.8 billion was spent across Britain over the four days between Black Friday and Cyber Monday, a 15 percent increase from 2015. Unsurprisingly, the fastest growth came through online trading, which accounted for around £2.8 billion of that figure. Retail analysts are predicting that £1.27 billion will be spent in the UK this year on Black Friday alone.

There is evidence that these dates are increasingly registering with consumers. A PWC report from 2016 showed that 57 percent of shoppers held back on purchases to get a better deal on Black Friday or Cyber Monday. While this may be good news for the hard-pressed retail sector, this intensive sales blitz does present it and the wider business community with some significant challenges.

The growth in online sales, which often comes with a next day, or even same day, delivery requirement, puts huge pressure on the UK logistics networks. The most successful retailers are likely to be those that have reviewed their technology, marketing and logistics operations well in advance to prepare for the spike in activity with processes in place to ensure that order fulfilment runs smoothly.

The wider business community should also put contingency plans in place to avoid potential disruptions to their operations from the inevitable pressure this week and next. Already many retailers are opting out of Black Friday and Cyber Monday, with others limiting the number of fast-track deliveries – all things that we can expect to see more of. While the growing success of these events is welcomed by retailers, the high intensity of activity in a short time can take its toll elsewhere. No matter the price, a bargain can be costly.

Kirsten Partridge, Partner, CMS

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