Small businesses prepare for an uncertain holiday season

Small businesses in the US are stocking up early this year for the holiday season and waiting to see how many gifts inflation-wary consumers want to buy.

Christmas sales have been relatively strong in the past two years, with a large influx of the public into online stores with money obtained from the pandemic stimulus.

Sales in November and December averaged about 20% of the annual total, according to the National Retail Federation, which is why the holiday season is so important for many businesses.

This year, small businesses expect more caution from consumers. AlixPartners, a global consulting firm, expects holiday sales to increase between 4% and 7%, well below the 16% recorded in 2021. With inflation above 8%, retailers expect lower sales.

To prepare, owners say they are ordering early to avoid the supply chain disruptions that have affected the past two seasons and to attract early buyers.

They are also quick to grab whatever discounts they can and hope more shoppers will flock to stores this year now that they have moved away from the pandemic.

“The only certainty we have is that nothing will be predictable. We don’t really know what to expect and our retailers feel the same way,” said Max Rhodes, CEO of Faire, an online marketplace used by small businesses for bulk purchases.

Although the economic impact of the pandemic has diminished significantly, consumers now have inflation and high interest rates against them. Overall, spending has remained high, but some Americans have had to move away from less-needed items.

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It could be any significant drop, because consumer spending makes up about 70% of economic activity.

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Aileen Morales

"Beer nerd. Food fanatic. Alcohol scholar. Tv practitioner. Writer. Troublemaker. Falls down a lot."

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