Tuesday, November 30th, 2021
Empty shelves before Christmas Eve?
Delivery problems tarnish Christmas business
Flexibility could be required for Christmas gifts: toy retailers in particular complain of delivery bottlenecks. Other “gift industries” are also reporting difficulties – all the more surprising that the retail sector is still assuming record sales.
In the midst of the high-turnover Christmas business, the delivery problems of German retailers have worsened significantly. In November, 77.8 percent complained that not all goods ordered could be delivered, according to the Ifo Institute survey. In October it was only 60 percent, in September 74 percent. “Some place on the shelf will probably remain empty for Christmas,” said the head of the Ifo surveys, Klaus Wohlrabe. “Consumers need a certain amount of flexibility when it comes to Christmas gifts.”
The expert also named an important reason for the misery: “There is still sand in the gears of global logistics,” said Wohlrabe. “Many ship deliveries are delayed.” Against this background, price increases are to be expected. “More than two thirds of the retailers want to raise their sales prices in the next three months,” added Wohlrabe.
In the toy retail sector, all participating companies reported problems. Almost all dealers in the bicycle (95.8 percent) and automobile (93.5 percent) trade are also affected by the difficulties. This was 93 percent of the hardware stores and 91.3 percent of computer retailers. The replenishment for all electronic products is considered difficult.
Life-threatening first half of the year
Despite delivery problems plus the corona crisis and high inflation, the German Retail Association (HDE) is expecting record sales in the current Christmas business so far. Revenues are expected to increase in November and December by two percent compared to the same period last year to just under 112 billion euros. “The high savings and the positive consumer sentiment set the course for a conciliatory end to the year after a first half-year that threatened the existence of many retailers with the lockdowns,” said HDE Managing Director Stefan Genth recently.
The Christmas business is mainly driven by online trading, which is expected to increase by 17.3 percent to 23.1 billion euros. Traditionally, classic gift industries such as the toy trade make more than a fifth of their annual turnover in November and December.