Commercial awareness: think like a professional about... Black Friday | Commercial awareness on The Gateway

Commercial awareness: think like a professional about... Black Friday

Our banker, lawyer, accountant and consultant consider this new retail phenomenon

Black Friday is now big business in the UK. The day is a imported tradition from the US where it's a post-Thanksgiving holiday when Americans traditionally start their Christmas shopping and push retailers out of debt and "into the black" for the year.

In America, Black Friday deals and discounts abound. Amazon claims to have been running Black Friday deals in the UK for several years, but many UK high-street retailers only really seem to have joined in since 2013. But this year, Black Friday publicity and promotions could be found everywhere from Boots to Tesco to John Lewis.

UK shoppers have responded, and Black Friday may have contributed to a boost in pre-Christmas spending figures. The British Retail Consortium recently announced that total retail spending was up by 2.2 per cent this November compared to the same month last year.

Thinking like a...

...banker

Oiling the shopping trolley wheels

Black Friday is a good example of how the financial markets that bankers and traders work with can have a noticeable effect on the real economy. For the past couple of months, oil prices have been falling, and they recently hit a five-year low.

This in turn has meant that consumer energy prices have also become lower, and some commentators have suggested that because many people are spending a bit less on bills than they expected, there's more money free for Black Friday offers and deals.

...lawyer

Legal niceties - and nasties

In the US, the aftermath of Black Friday is a busy time for lawyers as the shopping frenzy can result in personal injury claims as shoppers scramble for the best deal and retail workers try to keep the crowds under control - in 2008, a Walmart employee tragically died after being trampled by over-enthusiastic bargain hunters. As Black Friday becomes bigger in the UK, lawyers here might see more of this kind of work.

Black Friday has also prompted debates in the legal press over whether shoppers can be prosecuted for theft if they take an item someone else has claimed, but not paid for.

...accountant

What a relief!

As well as solid Black Friday sales, there's been other good news for retailers recently. In this year's Autumn Statement, George Osborne announced plans to reform the business rates system - essentially the taxes that retailers, like other UK businesses, pay to occupy their property. He said he would cap inflation-linked increase to business rates at 2 per cent and would also reconsider the way in which the tax is structured.

Osborne also announced a number of extensions to existing tax reliefs for small businesses, which should provide extra help for boutique retailers.

...consultant

Broadband bargains

The UK's shoppers are some of the most internet-savvy in the world, buying online more than their fellow bargain hunters in many other nations. The Black Friday frenzy was no exception to this trend, with many retailers offering online deals, dedicated pages on their websites, and social media campaigns and promotions.

Professional services firm Deloitte estimated that online shopping would account for 13 per cent of Black Friday sales, so it looks like those UK retailers who want to make the most of Black Friday in the future will have to make sure their online offering is up to speed.

Image: Diariocritico de Venezuela (https://www.flickr.com/photos/diariocriticove/)

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