He retail sales growth of 3.6% compared to the same month last yearIt is undoubtedly a good fact, especially encouraged by the purchases of ‘personal equipment’ before the start of the school season and the arrival of the cold.
Of course, unilocalized companies are, once again, the least growing compared to higher rises in other formats. A small and medium trade that has taken some oxygen in September but, nevertheless, looks suspiciously at the nearest horizon: the last two months of the year, in which a dynamic imposed by continued discounts prevails. The starting gun: Black Friday.
"Division" is the word that best defines what generates 'black Friday' in small and medium-sized merchants, a campaign that has not stopped growing steadily for about five years, but that has completely disrupted not only the campaigns of Christmas and Sales, the most important of the year for sales of any traditional trade, but also the dynamics of consumption throughout the year.
Therefore, small and medium-sized merchants face a 'marathon' of discounts imposed by the Internet and other commercial formats, which begins with Black Friday and continues with CyberMonday, linking with an already weakened Christmas and Kings campaign and culminating with sales winter already far from the results of a few years ago.
Approximately 40% of small and medium-sized businesses joined Black Friday in one way or another in 2018 making some kind of discount or promotion in your business, a figure that will be similar this year. But beyond the visibility offered by this day and the fact of not being "off the hook" compared to other formats, few are those who do it because they find it profitable. On the contrary, as the president of the Spanish Confederation of Commerce, CEC, Pedro Campo: “They have no choice; they have realized that, otherwise, they lose sales of the Christmas campaign. ”
And is that Black Friday has transferred the expense that consumers reserved for Christmas gifts and sales, in many cases advancing their purchases to the discounts of the month of November. The pressure on the margins imposed by this dynamic of permanent discounts is unsustainable for small businesses.
From the CEC we continue to insist that these types of campaigns based exclusively on price reduction make less and less sense.
Therefore, although it is impossible to establish common strategies, since each sector and product range has a very different profit margin and competitive environment, from the Confederation we advise those merchants who want to join Black Friday to do so with moderate discounts, that they do not 'burst' their margins, and that they focus on valuing the benefits of proximity trade.