The phenomena started in the US, to capitalise on the opportunity to retail to millions of Americans taking time off from work to enjoy Thanksgiving celebrations.
Now the globalisation of the retail market means international brands and retailers are now using Black Friday as a trigger point to launch seasonal offers across the world, and this year UK consumers are also expected to benefit from a host of tempting Christmas deals.
However experts caution that instead of cashing in for Christmas, UK retailers could be left with a £640m worth of lost sales caused by retail operations struggling to cope with a dramatic surge in sales.
Retail technology company, Retail Assist has calculated the potential cost to retailers from the value of sales they could miss out on if the retail operation buckles under the pressure of a surge in sales.
They predict the biggest risk to retailers is at the till point, with an average of 1.82% of EPOS systems expected to be down every day during December, leading to increased wait times, in store congestion and basket abandonment.
Dan Smith, Retail Assist CEO comments: “The potential financial penalty to retailers from something as simple as a till going down is huge, as they could end up losing sales from consumers who are already committed to purchasing but end up abandoning their basket in frustration. ”
Retail Assist believes that retailers are not just vulnerable from losing sales at the till point, but also through inventory systems not being up to scratch. Dan Smith continues: “Our research indicates that 57% of people will be buying their Christmas gifts through on and offline shopping. It means, however the consumer is shopping, the retailer has to be in a position to meet a consumer demand.
“Inventory systems need to be integrated to ensure whether the consumer shops online, in-store, through catalogue, tv or mobile, the retailer can fulfil the order and not let the consumer down. We estimate that at least 75% of retailers have failed to get their inventory systems integrated across all retailing channels, and it is highly likely they will lose sales through not being able to supply customers with a product they want to buy.”
Dan Smith concludes: “As UK retailers continue to experience a challenging economic climate our message is that retailers should be counting the cost of lost sales from preventable retail operations problems.
"As well as investing in front line sales staff, retailers need to ensure their technology is equipped to cope with intense operational activity across multiple retailing channels. If technology and the supply chain fail to deliver then it will not only damage sales but shall deter people from returning which will be a detrimental outcome for any retailer.”
Retail Assist Limited
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