How inflation will impact holiday shopping
PITTSBURGH (KDKA) - You might think it's too early to talk about holiday shopping before the leaves have even changed. But this year is different, because of high inflation.
Toys cost nearly 3% more compared to last year. Clothes are about 5% more expensive. And household items are up more than 10%.
That has consumers looking for the best deals and retailers are eager to compete for their dollars.
Forget about Black Friday. Holiday shoppers are already hunting for the best deals.
Half of this year's gift-givers said they plan to start shopping by the end of October. That's why Target rolled out its Deal Days event this week, slashing prices up to 50%, just days ahead of Amazon's highly-anticipated Prime Early Access Sale.
"Retailers definitely have an arms race to reach shoppers while a shopper still has her or his money to spend on holiday items," Burt Flickinger said.
New surveys show, 40% of holiday shoppers said inflation will impact their purchases, with many choosing to buy fewer gifts -- and at a discount.
What items are consumers going to find the best deals on?
"Clothing will be deeply discounted, consumer electronics, TVs, consumer audio, and books," said Flickinger.
Amazon just announced it's hiring 150,000 workers ahead of the holiday rush. But Walmart's only hiring 40,000 workers because it's already staffed with more permanent positions this year -- a trend that's expected to continue.
"Companies still need a lot of extra help during the holidays. But in this scenario, some companies are going to be asking people to stay," said Andrew Challenger, Senior Vice President of Challenger, Gray, and Christmas.
For some small business owners like Alen Harikian -- the holiday outlook is bleak. His family has owned SpeersTV for more than 30 years. But he said big box retailers have made it harder for his shop to get popular TVs -- and he can't compete with their low prices.
"If I buy a Samsung TV, let's say for $500, a week later, Amazon or Best Buy is selling it for $390. So I've lost $100. So, it just doesn't make sense," Harikian said.
What happens to this business?
"It's going to go out of business," Harikian said.
Harikian said he won't be able to keep his doors open past the end of the month, which is too bad because a new survey from the National Retail Federation suggests holiday shoppers are ready to get back out there after COVID.
And many said they want to shop in person.