(Bloomberg) — It’s crunch time for U.S. retailers as masses of shoppers return to in-person shopping after the long, pandemic-induced hiatus.
This year is shaping up to be another record for overall spending. But there’s a long list of concerns, which have been reinforced in recent weeks by a series of uneven earnings reports. Will retailers have enough products to meet high demand as shipping containers pile up at ports? Will consumers be willing to pay more for their merchandise amid rising prices and scarce discounts? And will companies have enough manpower to handle the expected rise in spending?
We’ll be taking a look at the latest information as it becomes available through the day. All time stamps reflect the U.S. East Coast.
Wall Street Worries About Black Friday Prospects (7:51 a.m.)
Investors seem awfully pessimistic heading into Black Friday.
Retail stocks are down pretty much across the board in premarket trading as U.S. chains start opening their doors to shoppers. Adobe may have spooked Wall Street after saying late Thursday that online sales on Thanksgiving likely came in lower than expected, while the rise of a new Covid-19 variant is also hurting stocks. Retailers have already been grappling with rising costs, stock shortages and a tight labor supply, so a decline in consumer demand would add to their woes.
Among the major names trending lower, Gap Inc. slipped 3.5% as of 7:51 a.m. in New York, Kohl’s Corp. fell 4.4%, Macy’s tumbled 5% and Bed Bath & Beyond Inc. was down 2.4%. Target Corp., Walmart Inc., Home Depot Inc. and Lowe’s Cos. were each down 1% or more. Mall-based chains similarly struggled, with Abercrombie & Fitch Co., American Eagle Outfitters Inc. and Tapestry Inc. also declining.
Adobe Lowers Spending Estimate for Thanksgiving (12:01 a.m.)
E-commerce spending by U.S. consumers on Thanksgiving Day will probably climb to a record — but sales may not be as strong as initially expected.
Consumers were on track to spend $5.1 billion to $5.4 billion online Thursday, according to an estimate from the Adobe Digital Economy Index. The top end of the estimate was lowered from a previous estimate of as much as $5.9 billion.
“What we’ve seen this afternoon is that we’re on a trajectory in which the Thanksgiving Day total will be closer to the lower half of our originally proposed range,” Taylor Schreiner, director at Adobe Digital Insights, said in a statement. “This can be attributed to consumers spreading out their spending across November, which has shown up in more $3 billion online shopping days thus far.”
Small Businesses Face Staffing Hurdles (12:01 a.m.)
Small businesses are feeling “pretty optimistic” about the holiday season, said John Waldmann, chief executive officer of Homebase, a software company that helps small businesses manage their teams. But challenges still loom, particularly in regards to staffing, he said in a recent interview.
About 35% of small business owners said they are looking to hire at least one seasonal team member. This means that some companies will be understaffed, some will be short on experience, and some will suffer from both problems, Waldmann said. He said that more than 60% of small businesses reported they’ll be paying workers more this year, compared with 2020.
Staffing shortages could mean a less-pleasant experience for shoppers. “Consumers, be patient and be kind,” he said.
Homebase recently surveyed 400 small business owners and 2,000 employees about their outlook for the holidays.
Macy’s CEO Talks Store Traffic, Staffing (12:01 a.m.)
Macy’s Inc. CEO Jeff Gennette said he doesn’t see Black Friday foot traffic bouncing back to pre-pandemic levels this year, adding that traffic at stores remains below what it was in 2019. More of those who go in are actually making a purchase, however.
Like the rest of the industry, staffing has been a challenge.
“We’ve got some stores in great shape and some stores that are really lean,” Gennette said in an interview last week. The department-store chain said earlier this month it would raise the minimum wage to $15 an hour by May. Because of seasonal challenges, that pay boost has already gone into effect in more than 100 stores for the Christmas hiring season.
Hiring has improved,“but we still have some gaps and open jobs,” he said. “We’re mitigating that by offering spot bonuses or premium pay for weekends. We’re offering our colleagues opportunity for overtime and working six days.”
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