Black Friday and the UK Economy
Black Friday is the yearly promo event that was brought over from the states and introduced to Britain in 2010 by the internet retail company Amazon. It has grown bigger each year since and tends to be predominantly more of an online thing today.
This year’s sales period will be between the 20th and the 27th of November, spending during Black Friday has been forecast to increase by 3.8 percent yearly up to £10.1 billion, an equivalent to 10.4% of the estimated total for the final 3 months of the year.
Consumer spending is what turns the cogs of economic growth in Britain, but it’s being squeezed due to rises in inflation, wakening wage growth and by the concern of shoppers over the impact that Brexit could potentially have.
The popularity of Black Friday now means that the Christmas trading season in Britain now has 3 peaks, the week around Black Friday, the week up to Christmas (25th) and the after Christmas sales. However after a drop in sterling since the decision of the 2016 Brexit vote to leave the EU, import costs for retailers have been driven up, tightening their margins and leaving them unable to offer the same scale of discounts as before.
Black Friday continues to divide opinions with retailers.
The supporters argue that well planned, targeted promotions with global suppliers will help them to achieve a boost in sales while still preserving profits margins.
While critics will argue that the Black Friday discounts ultimately bring forward Christmas sales the retailers would have otherwise been able to make at full price and can reduce business in the following weeks.