Black Friday Discounts to Be More Strategic This Year Due to Tariffs.
As businesses prepare for the biggest shopping day of the year, they're facing a difficult decision: whether to run aggressive Black Friday promotions that may result in lower profits or charge full price and risk alienating customers.
Higher US tariffs on imports from countries like Taiwan and China have increased costs for retailers, making it challenging to offer substantial discounts. According to Lisa Cheng Smith, founder of Yun Hai Taiwanese Pantry, a New York City-based retailer that imports products from Taiwan, her company's costs have jumped 20% to 50% this year due to the tariffs.
In previous years, Yun Hai has offered a 15% Black Friday discount as part of its promotional strategy. However, this year, Cheng Smith is unsure how much of a discount she can afford to offer given her higher operational costs resulting from the tariffs. The decision is complicated by the retail math and the need to preserve margins.
Small business owners like Cheng Smith are particularly affected, with their sales making up a significant portion of their annual revenue. Every day counts during this critical period, and every percentage point in profit margins can make a big difference.
Retail experts predict that Black Friday discounts will be more surgical and selective this year. Neil Saunders, managing director and retail analyst at GlobalData, said retailers will discount fewer items and some discounts will be less generous. Dan Peskorse, whose company Upstream Brands sells merchandise on Amazon and other e-commerce sites, has decided to scrap across-the-board discounts due to the impact of tariffs.
Higher tariff rates have increased by sevenfold this year, reaching 16.6%, according to EY-Parthenon chief economist Gregory Daco. This is pushing up prices of imported goods, which retailers are passing on to consumers. Retail analyst Sonia Lapinsky said the slowdown in holiday spending by lower-income consumers, still feeling the impact of persistent inflation, will also affect the Black Friday sales.
"It's going to be a strange season," Lapinsky warned. "Consumers are holding onto their dollars and putting them in critical places, not in discretionary buckets." Discounts are essential for retailers to get customers in the door, but if they're done incorrectly, it could be disastrous. The stakes are high this year, and retailers will need to navigate these challenges carefully.
As businesses prepare for the biggest shopping day of the year, they're facing a difficult decision: whether to run aggressive Black Friday promotions that may result in lower profits or charge full price and risk alienating customers.
Higher US tariffs on imports from countries like Taiwan and China have increased costs for retailers, making it challenging to offer substantial discounts. According to Lisa Cheng Smith, founder of Yun Hai Taiwanese Pantry, a New York City-based retailer that imports products from Taiwan, her company's costs have jumped 20% to 50% this year due to the tariffs.
In previous years, Yun Hai has offered a 15% Black Friday discount as part of its promotional strategy. However, this year, Cheng Smith is unsure how much of a discount she can afford to offer given her higher operational costs resulting from the tariffs. The decision is complicated by the retail math and the need to preserve margins.
Small business owners like Cheng Smith are particularly affected, with their sales making up a significant portion of their annual revenue. Every day counts during this critical period, and every percentage point in profit margins can make a big difference.
Retail experts predict that Black Friday discounts will be more surgical and selective this year. Neil Saunders, managing director and retail analyst at GlobalData, said retailers will discount fewer items and some discounts will be less generous. Dan Peskorse, whose company Upstream Brands sells merchandise on Amazon and other e-commerce sites, has decided to scrap across-the-board discounts due to the impact of tariffs.
Higher tariff rates have increased by sevenfold this year, reaching 16.6%, according to EY-Parthenon chief economist Gregory Daco. This is pushing up prices of imported goods, which retailers are passing on to consumers. Retail analyst Sonia Lapinsky said the slowdown in holiday spending by lower-income consumers, still feeling the impact of persistent inflation, will also affect the Black Friday sales.
"It's going to be a strange season," Lapinsky warned. "Consumers are holding onto their dollars and putting them in critical places, not in discretionary buckets." Discounts are essential for retailers to get customers in the door, but if they're done incorrectly, it could be disastrous. The stakes are high this year, and retailers will need to navigate these challenges carefully.
. On one hand, I love getting deals on my fave gadgets and stuff, but at the same time, I hate when they're just ripping people off with super high prices just a few months ago 
. And now these tariffs are messing with all that... it's like, what even is the point of having a sale if you can't afford to keep up with production costs? 
. Maybe they could offer smaller discounts on specific items or bundle deals that still make customers happy? 
And honestly, I kinda miss the good ol' days when Black Friday was just about getting some sweet deals, without all the hype and drama 
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this black friday season... Small businesses gotta walk a thin line between offerin decent discounts & still makin ends meet. Higher tariffs mean higher costs for imports, so it's hard to justify givein out too much $$ 
. It's not just about giving out discounts to get customers in; they need to make sure it's worth it in terms of profits too 
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Retailers gotta balance their discounts with the costs of tariffs, you feel? It's like, they wanna keep those margins intact but at the same time, they don't wanna lose customers to other stores who are offering more deals 
), but if it means sacrificing profits, that's not cool 
. Smaller businesses like Yun Hai Taiwanese Pantry are already feeling the pinch with their costs increasing by 20-50%! 
. Retailers gotta navigate this carefully to not mess up their Black Friday game 
. Fingers crossed they can make it work! 
i mean i'm all for saving money and stuff, but 20-50% increase in costs is crazy talk 
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. No more across-the-board discounts like Dan Peskorse scrapped on Amazon. It's all about savin' those precious profit margins, and makin' sure they're not losin' money in the process 
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. i get it, they need to make a profit or else they'll be out of business, but at the same time, customers expect discounts on black friday 
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. At the same time, I know that lower-income families might be feeling the pinch from inflation and need those discounts more than ever 
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. Whatever they do, I just hope it doesn't affect my kid's favorite store too much 
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. Retailers are basically tryin' to squeeze every last penny outta us before the holiday season even starts... it's all about the Benjamins, man 
. It's like, if you can afford a slightly higher price now, do you really need that extra discount? I think retailers should find ways to still make their promotions attractive without sacrificing too much profit margin 
. Overall, it's gonna be interesting to see how this all plays out 
Retail experts say it'll be more surgical and selective discounts, so don't expect those crazy 50% off deals anymore 
, like scraping across-the-board deals or being more selective with what they offer 
. it shows that businesses are thinking carefully about how to make the most of this big shopping day 
. and hey, who knows, maybe consumers will even be more discerning this year and actually appreciate a more thoughtful shopping experience 
Anyway, I'm curious to see how retailers balance their discounts with keeping prices reasonable for customers