After a disappointing Black Friday, clouds are gathering over the 2022 holiday shopping season.
This Thanksgiving, media outlets were full of ideas about how to stretch the family budget further this year. With everything families normally buy to celebrate the holiday season — including dinner traditions — adding up to so much more this year, any ideas might seem welcome.
It’s hard to imagine Americans trading butter for baby food on their traditional hot rolls, no matter that the former has risen in price faster than the latter, but some of the tips weren’t bad.
After all, a 26-story high-rise pork processing center opened in China yesterday, the first of its kind. Though animal agriculture experts are already warning about the increased risk of disease, more such “pig palaces” are likely to follow. Just imagine — 26 slaughterhouses, all stacked on top of each other.
Considering the non-sustainability of industrial animal agriculture on that scale, and on a planet playing host to nearly 8 billion people, cutting down on animal products as a cost-saving measure is an excellent idea — for financial, environmental, and health reasons.
Now that Thanksgiving, whatever its inflated price tag, has come and gone, American consumers are turning their attention to the upcoming holiday season.
Several major world religions celebrate a wintertime holiday around the end of the year. Since Christmas and Hanukkah also happen to be gift-giving holidays, the holiday shopping season was born.
Over the years in post-Industrial America, the Christmas holiday shopping season gradually grew into the mall and online bonanzas we ardently love — or assiduously avoid — today. In the age of conspicuous consumerism —a brilliant marketing scheme if ever there was one, second perhaps only to virtue signaling — the holiday shopping season has grown into a mainstay of the retail industry.
Like yearly Christmas-time bonuses employees come to count on as part of their salary, retailers have come to depend on a big boost in sales at year’s end to help make up for any budget shortfalls throughout the year.
And 2020 and 2021 were full of budget shortfalls for most retailers.
This year, retailers from Target to your favorite local small businesses are eyeing their account books nervously and wondering what the Christmas season might hold.
Black Friday, that annual post-Turkey mallroom blitz, underperformed this year, as well it might in a year when consumer confidence is down and inflation is up.
The American consumers who normally open their hearts and wallets to retailers during the most wonderful time of the year are feeling a bit less merry as 2022 draws to a close. It would be different if 2023 were shaping up to be any better economically for retailers and American consumers.
Unfortunately, the opposite scenario looks far more likely.
Already relying on credit cards to help compensate for a higher cost of living, many paycheck-to-paycheck families are struggling even more this year. Entering the holiday shopping season already deeply in the red, consumers are looking to cut spending any way they can.
Rent is up; the cost of cars, used and new, has also gone up exponentially, though the used car market appears to be cooling somewhat. New houses are more expensive, and though that market too is cooling slightly, financing is now more expensive.
Everything consumers buy is suddenly more expensive; gas, heating costs, and even bills. Companies strapped by falling economic fortunes have been raising their prices in an effort to stave off worse cost-cutting methods.
It didn’t work.
Companies like Peloton raised the price of their monthly subscription at a very inopportune time. Peloton customers responded by fleeing the service en masse.
Now, companies like Peloton have been forced to move on to a more drastic cost-cutting measure: Layoffs.
Mass layoffs are hitting some retail companies in advance of the holiday shopping season, which means fewer employees on the sales floor, fewer tech experts to keep the website running on Black Friday, and fewer corporate managers.
Fewer employees can mean reduced hours, which in turn cuts into retail sales — especially during a tight holiday season like this one where there is an incredible amount of competition for every consumer dollar.
All this hurts small businesses the most.
They have had to raise their prices most — to cope with the rising cost of doing business and keep the lights on. Small businesses don’t have as many products, or markets, to spread price increases around. Small businesses were hurt most by COVID-19 shutdowns, as they often weren’t as adept at changing instantly to a purely online business model.
With even companies like Target and Walmart experiencing dizzyingly dismal quarters in 2022, small businesses are going to be hard-pressed to compete with their corporate counterparts this Christmas season.
Those corporate counterparts, engaged in World Cup-level competition for every single sale, will be able to offer steeper discounts — which is one thing consumers are going to be on the watch for this year.
The Saturday after Black Friday has come to be known as “Small Business Saturday.” After today, it will be clear what kind of season small local retailers will be facing.
But unless a holiday miracle occurs, shoppers are going to spend less money this year because they have less money to spend. If major retailers aren’t able to compensate for 2022 losses over the holiday shopping season, employees are in for another round of layoffs after Christmas.
(contributing writer, Brooke Bell)