Supply chain woes threaten to unravel UK & US retailers' holiday hopes

Among the top worries for retailers are missing their holiday sales forecasts, with 91 per cent fearing this outcome. About 81 per cent are concerned that strained family budgets will significantly reduce consumer spending. Additionally, 77 per cent of retailers are bracing themselves for product shortages, as per the study.

For consumers, financial concerns are also paramount. Nearly three-quarters of those surveyed are worried that the cost of living will negatively impact their spending. This is a sentiment that is particularly strong among Gen Z and Millennials, where 80 per cent express this concern.

In terms of shopping behaviour, two-thirds of consumers are influenced by the cost of living, and over half are influenced by rising inflation. Consumers are actively seeking savings: 50 per cent are waiting for discounts and sales, and 51 per cent say that deals are their top motivating factor for purchasing from a specific retailer. Brands have responded by offering deals and sales earlier, with 65 per cent doing so, and increasing the number of deals, reported by 58 per cent of retailers. However, almost half of consumers are planning to defer their shopping until the end of the year, which may dampen the holiday spirit.

As for the supply chain issues, retailers predict that household goods and decor will be most impacted, at 45 per cent, followed by apparel and electronics, both at 41 per cent. These disruptions are also causing concern among businesses about excess inventory and supplier reliability. Half of the businesses surveyed are dealing with excess inventory, and 54 per cent are concerned about one or more of their company's suppliers shutting down. Furthermore, labour shortages this holiday season are expected to result in increased wait and shipping times, as cited by 61 and 54 per cent of retailers, respectively.

ALCHEMPro News Desk (DP)