Logistics & Supply Chain Management by Martin Christopher

Logistics & Supply Chain Management by Martin Christopher

Author:Martin Christopher [Christopher Martin]
Language: eng
Format: epub, pdf
Publisher: Pearson Education Limited
Published: 2016-02-22T16:00:00+00:00


‘Black Friday’ – a self-inflicted injury?

On Friday 28 November 2014 the UK was gripped with a frenzy of consumption as customers sought to take advantage of the deep price cuts offered by many leading retail chains. ‘Black Friday’ – as the day is termed – is a long-established tradition in the USA, but only recently adopted by British retailers. The idea behind Black Friday is that at the start of the run up to the Christmas trading period products are promoted through limited period price cuts, presumably to kick-start the end-of-year buying spree. Traditionally, in the United States the Friday following Thanksgiving Day is the day when Christmas shopping begins in earnest – now known as Black Friday.

This recent import from the USA caused havoc in the UK high street and in on-line shopping. Many retailers recorded record sales on that day both through their bricks and mortar outlets as well as on-line – Internet sales for example were 30% higher than normal. As a result of this dramatic increase in volume, retailers’ logistics systems were put under immense pressure, and home deliveries were severely affected with many delivery service providers unable to cope with the surge.

The paradox is that for many companies their total sales revenue for the whole of the Christmas trading period was flat on a like-for-like basis. All that had happened was that customers brought forward their purchases – and bought at a lower price. The combined impact of higher logistics costs and marked-down prices inevitably eroded retailers’ profitability.

Even though retailers and industry specialists have long recognised that promotions of this type rarely boost profits – in fact the reverse is usually the case – it seems that these self-induced injuries are hard to eradicate.



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