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There will be fewer sales in stores this season. This is the reason

2021-10-19T21:34:55.687Z


If you were looking forward to the offers to buy holiday gifts, problems in the supply chain could prevent it.


Supply chain crisis could last until 2022 0:56

New York (CNN) - 

Every year, shoppers expect to find plenty of juicy bargains when they start shopping for their end-of-the-year gifts.

This year, those deep discounts could be harder to come by, and the global supply chain is to blame.

Retailers around the world are fighting to keep their goods from getting stuck on the container ships that carry them due to port congestion.

Adding to the problem is the shortage of workers needed to unload and transport products from ships to warehouses and distribution centers.

  • The global supply chain nightmare is about to get worse

Many stores will not be able to get merchandise that should have arrived by the start of the holiday sales season.

And when they run out of items they have, they risk running out of those items for much longer than usual.

Inventory limitations mean that stores have less incentive to offer discounts on the products they carry.

Macy's executives, speaking at a Goldman Sachs conference last month, said the retailer has offered fewer discounts this year due to tighter inventory, which has helped boost profits.

"From a promotional point of view, this year's promotion levels have been lower than historical levels, and we have thought about the categories that need promotion and will continue to do so," said Macy's CFO Adrian Mitchell during the conference.

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Women's clothing chain J. Jill also noted that discounts will be less substantial in the coming weeks.

"Supply chain disruption is increasing, resulting in high shipping costs and delays," said J.Jill CFO Mark Webb during the retailer's last earnings call with analysts in September.

Stores are experiencing delays in receiving merchandise due to port congestion.

(Photo by Mario Tama / Getty Images)

Look at the bottleneck formed by cargo ships 3:53

Fewer products, less offers

While the company is working with its suppliers to streamline shipments, Webb said it expects those disruptions to continue in the coming weeks.

Webb added that the retailer is focusing on offsetting higher costs from supply chain pressures by offering fewer discounts and selling products at full price.

Steve Lawrence, director of marketing for the sporting goods chain Academy Sports + Outdoors, also told CNN Business that shoppers will see fewer major discounts during the holiday season this year.

  • Container shortage: manufacturers are forced to prioritize small, squishy toys for Christmas

"There have been a lot less promotions in the market because there has been a shortage of supply ... Last year it did not have many promotions. We do not think these parties are going to have many promotions either," Lawrence said.

Wells Fargo analyst Ike Boruchow said in a note this month that retailers offered fewer promotions in September than at the same time last year as they entered the holiday shopping period.

"Sales fell again in September, probably due to supply chain problems," Boruchow wrote in the note.

"Factory closures in Vietnam, as well as port delays, are limiting the ability of brands and retailers to bring product."

- Nathaniel Meyersohn of CNN Business contributed to this report.

supply chain

Source: cnnespanol

All news articles on 2021-10-19

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