Retail: preparing for Christmas

Retail: preparing for Christmas


by Grant Fraser

Global Head of eCommerce Financing


The UK is set to spend £7bn on Black Friday weekend 2020

Black Friday Retail Black Friday is hailed as the advent of the Christmas shopping season. The term originated in America and is typically the Friday after the Thanksgiving holiday (the 4th Thursday in November). Adopted in the UK, Black Friday has grown in notoriety over the last decade. In 2020, Black Friday will fall on the 27th November and Cyber Monday will follow on 30th November.

The UK is estimated to spend £7bn across over the course of the weekend.


It’s been a strange year in retail

The COVID-19 pandemic; the government imposed lockdown; the surge in eCommerce; the simultaneous demise of the UK’s high streets.

Retail has begun to rally, with reports suggesting that high street sales rose above pre-pandemic levels in July. As lockdown eased the office of national statistics reported that the volume of sales rose 3.6%. As retail businesses throughout the UK would normally turn their attention to what is typically the busiest quarter of the year, what can we expect to see, and how can we prepare for Christmas 2020?


The surge in the eCommerce industry

Social Distancing in Retail The opportunity for the eCommerce industry lies in the fact that it could potentially be a particularly complex holiday season for high street retailers this year. The return from lockdown amidst talk of a second wave of the Coronavirus creates a constant uncertainty and tension.

There are ongoing social distancing measures, combined with a requirement for PPE in store.

There is a need for the retailers themselves to follow regimented hygiene protocols for both staff and customers, and even limit numbers of people in stores. The imminent prospect of a global recession has lessened consumer confidence. Will the desire to splurge for Christmas be lessened too?

There is one (much less widely-discussed) challenge that both the surging eCommerce world and the ailing high street share. Supply.

In a time of heightened demand and in the era of COVID-19, the requirement to keep a ready supply of stock, and the ability to deliver it, casts a shadow over planning for Christmas 2020.

Supply chains have been disrupted both within the UK and from overseas. The COVID-19 pandemic has been tremendously challenging for businesses of all sizes, but it’s a particularly difficult path forward for smaller suppliers. Typically, these smaller merchants may not have quick, affordable or fair access to cash that will allow them to bridge the gap and emerge from the other side of this global crisis.

This presents potential challenges for both high street retailers and eCommerce providers, who depend on a range of vendors and producers to meet demand, and to remain flexible in response to consumer behaviours.


Setting up for success this Christmas

As high street spending dropped through the floor and continues on the slow path to recovery, eCommerce has experienced incredible growth.

74% growth in online shopping is reported since the onset of COVID-19 (Modern Retail, Aug 2020)  and the imposed government lockdown.

It is essential that eCommerce businesses set themselves up for success this Christmas.

The UK’s online businesses must be prepared to scale up and meet the predicted surge in consumer demand this Christmas. In doing this, as well as balancing supply and demand, one of the biggest challenges in planning for a successful Black Friday, Cyber Monday, and the lead up to Christmas, is cashflow.

Those online businesses with the working capital in place to ensure that orders can be taken and fulfilled in a time of increased demand will grow.

Woodsford TradeBridge eCommerce Finance is ideally placed to fund and support that growth.

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