SUPPLY CHAIN DISRUPTIONS SPOILED THE BLACK FRIDAY PARTY - Palak Gupta

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And it’s that time of the year! Holiday shopping is back and Black Friday has always been a time when people all over the world either stock up or spend big. Black Friday, the Friday after Thanksgiving, marks the beginning of the holiday shopping season. The term "Black Friday" stems from the days when ledgers were used for bookkeeping, and the time of year when the ink turned from red (loss) to black (profit) was around this time of year.

Covid-19 rippled the retail sector in 2020 altering the way consumers shop and the way workers serve customers. As the world enters the second year of this shopping season post-pandemic, the picture looks a little different. While 2020 was tense on the demand side, 2021 Black Friday was tense on the supply side due to a shortage of enough goods or staff to satisfy them.

With many huge retailers facing rapidly increasing revenues and high demand for their products entering into the season, they are also struggling with making those products available to the consumers to fulfill the demand. The notable reasons for the same are the supply-chain disruptions around the world and Covid-19 restrictions, creating a lag in production. This supply-chain snarl is leading to huge backorder with the retails as wholesalers and suppliers are unable to restock the sold-out items. Big retail chains like Victoria’s Secret & Co., Gap Inc. have reported the same issue fearing a conservation holiday season. 

In addition to this, the U.S. is entering into the Great Resignation period creating labor shortages as people are quitting retail jobs. This has made handling the customer grievances even more difficult with delays in escalations and handling of customer care centers.

As consumers become more skeptical of this issue affecting their purchasing behavior, many retailers also started educating and training their employees on how to handle the various questions posed by the customers and how to serve them better, taking into account, limited variety and inventory.

In my opinion, while customers were relatively more comfortable heading out to shop in stores this year in comparison to the previous year, challenges in the supply chain and early delays in October prompted the customers to spread out their spending. Also, this disruption in supply can lead to a rise in prices of certain products due to insufficient sales volume available and additional costs involved in making this supply available. Furthermore, the retail stores should have been more cautious and piled up their inventory as they saw the unprecedented disruption arising from the past few months.

Customer experience is the key to this year’s successful holiday season. These types of strategies can ensure that supply chain issues aren’t noticed by the customer, while careful preparation will also be needed to make sure stock can be replenished.

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