James Moore: Will Black Friday be the day retail eats itself?

 

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The Independent Online

Outlook More proof that Friday’s ugly consumer grab-fest worked wonders for shops’ sales figures has emerged from John Lewis. To no great surprise its weekly numbers confirm that last week was the best, in the partnership’s 150-year trading history. There’s a degree of danger in using John Lewis as a bellwether for the retail industry. It has a unique structure and brand and an upscale customer base, and it has proved quite capable of bucking trends in the past.

But the Luxumbourg-based (guess why) amazon.co.uk has said much the same thing and it would be a big surprise not to see the Black Friday boom reflected across other parts of the industry. The ugly scrums produced in certain bricks-and-mortar outlets testify to that.

But what will be the effect of this event on overall retail sales during the critical pre-Christmas rush? That’s an interesting question. John Lewis, for example, reported sales of £179.1m, up 57 per cent on the previous week and 22 per cent on the previous year. It’s hard not to see those numbers having a negative impact on the business it does deeper into December, even if John Lewis customers are, on the whole, a fairly prosperous bunch.

Most UK householders, by contrast, remain under some budgetary pressure thanks to the torpid growth in wages compared with inflation. Credit might have helped fuel some of their Black Friday spending spree: there was disturbing evidence from the Bank of England on Monday that it’s doing just that, with potentially nasty consequences – though the consumer’s pound will only stretch so far.

Black Friday may yet prove to be an example of retail eating itself, with the offers which stores use to work their customers into a frenzy serving to cannibalise sales later on in the run-up to Christmas. You might hope that would result in retailers taking a hard look at their tactics next year. The trouble is it will only take one of them to make an aggressive pitch for Black Friday 2015 business to start the whole thing off again.

Unfortunately, this most unwelcome of American imports is here to stay.

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