Black Friday Shopping Faces Fewer Discounts And Delayed Deliveries: Here’s Why

Recent flooding in Europe and China is expected to cause a major disruption on Black Friday 2021, creating delivery delays and missing goods from store shelves as the global supply chain continues to get squeezed.

The devastating floods that hit both Western Europe and China’s Henan province have caused severe damage to transport hubs and businesses, which may bottleneck the already constrained shipping of goods and increase prices on a day when consumers expect deep discounts.

According to CNBC, railroads used to deliver goods and raw materials in both China and Europe were damaged in the floods, as well as facilities, machinery, and warehouses of companies in the supply chain industry.

Pawan Joshi, executive vice president of supply chain software firm E2open, told CNBC, “Black Friday and the holiday season, for which products (and raw materials) are being staged, will face the brunt of the impact.”

He continued in an email to the news outlet, “Consumer electronics, dorm room furniture, clothing and appliances will all continue to be in short supply as back-to-school shopping starts up, and will trickle into the peak holiday shopping season.”

Companies across various industries have already announced that they are raising the prices of their products due to an increase in the costs of raw materials and the limited availability of shipping containers.

Joshi told CNBC that the effects from the flooding could disrupt the supply chains “for weeks and months.”

Toymaker Hasbro said in April that it would increase the price of its toys and games as it looked to offset the cost of increasing raw material expenses. Toy company Mattel also warned that it was suffering from a “significant impact” to its margins from rising resin prices and ocean freight charges at the same time.

This is just another blow to the supply chain that was already hampered by the disruption caused by the Ever Given ship caught in the Suez Canal, blocking the passage of vessels for days back in March. A shortage of shipping containers is also compounding the issue along with the COVID pandemic and positive cases of the virus breaking out on ships in Southern China.

Joshi also told CNBC that there will most likely be fewer and smaller discounts this Black Friday, and some goods will see their prices going up.

“Come Black Friday, we can likely expect to see prices rise for all sorts of goods such as consumer electronics, furniture, apparel, and appliances,” he said.

Some of the most-impacted industries by the floods, according to CNBC, include autos, technology and electronics.