Black Friday is eating itself (even in Britain)

It’s the US import British retailers could do without. Black Friday marks the start of what promises to be a difficult Christmas for retailers — and the blizzard of special offers is a sign this year will be tougher than ever.

With inflation outstripping wage growth and higher interest rates looming, consumers are turning more cautious than last year. Retail sales were weak in October. Some of that might be due to the period being warmer than the same month last year, deterring consumers from buying a new coat or boots. But many customers may have been holding back for Black Friday’s special offers.

This year could be particularly concentrated. After a spike around Black Friday, there could well be a cooling off before spending picks up just before Christmas.

So far this year, non-food promotions have been running below their level in 2016, according to analysis by Richard Hyman, an independent retail consultant. But as Black Friday approaches, that’s likely to change. If shoppers show signs of holding back between Black Friday and the days before Christmas, retailers could well resort to desperate measures: slashing price to stimulate footfall. This new shape of Christmas has another pernicious effect. It makes the pressure on retailers’ essential plumbing more acute.
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