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The holiday shopping season seems to start earlier and earlier each year. There is a long list of issues plaguing the retail industry right now, including labor shortages, lack of inventory, and eager shoppers to spend, and this holiday shopping season is shaping up to be a wild ride.
If you’re the type who waits until the last minute, it might be best to start now before you have to pay higher prices or scramble to find that special gift.
Here’s what to keep in mind for the 2021 holiday shopping season, and why starting earlier will be beneficial.
Supply chain and inventory issues
Your holiday shopping experience will likely be different than in years past. Between issues with supply chains, rising cost of merchandise, staff shortages, and issues filling shelves with merchandise, retailers are gearing up for a tough few months.
According to Selling power, U.S. retailers will face an additional $ 223 billion in merchandise costs this shopping season. These rising costs are due to labor shortages and higher prices for shipping and manufacturing. The study suggests that retailers will bear the bulk of these costs, however, some of these expenses will likely be passed on to the consumer.
Deloitte suggests Americans will spend 7-9% more than they spent during the holiday season last year, for a total of $ 1.3 trillion. And with prices increase in almost all categories of consumers, buyers can expect to shell out more for freebies than ever before.
The semiconductor shortage continues to exert strong pressure on the supply of electronic products, as these items continue to be in high demand. This includes everything from computers and game consoles to vehicles and home appliances. And with many items out of stock for months, it’s best to start purchasing these items now to make sure they arrive before you need to redeem gifts.
There may be fewer sales (and they will start earlier)
The demand for gifts and holiday-related items appears to be higher than ever. In reality, Home Depot is out of stock for several Halloween items – in August.
Experts predict fewer big sales at retailers, even on big-name shopping days like Black Friday, due to high demand and lack of inventory. According to Roku and Harris poll on vacation 2021, 36% of shoppers plan to spend more this year than they did in 2020. This is the highest number reported since 2018 in the annual survey.
For retailers with sale, Kristen Gall, retail and shopping expert at Rakuten Rewards, says they will start relatively soon. âRetailers know that if they don’t sell their inventory before or during Black Friday, they will have a lot less time to move inventory. This means stores have a greater incentive to create deals sooner to beat their competition. . We are now witnessing a holiday sales launch as early as October to capitalize on earlier sales. “
However, these sales will be very different from past years, and getting the best deal will take a little more effort. âConsumers need to be flexible to take advantage of sales and will likely have to shop and watch multiple retailers,â she said.
If you aren’t able to capitalize on sales early on, you risk having to pay higher prices due to lingering supply chain issues. Gall added that the costs of the supply chain deadlock “will trickle down to consumers in the form of smaller sales and promotions this season, including fewer expedited and free shipping options.”
Start earlier and make a plan
Mix in rising costs, low supply, and buyers’ anxiety about finding the right gifts, and the holiday season could quickly turn into a budget nightmare. However, Gall recommends that by starting early, you can minimize the financial impact the holiday shopping season will have on your wallet.
“Your biggest advantage for saving [money] this holiday season will be time. The more time you have to shop, it will save you money, have the confidence that you get the gifts you want, and avoid the hassle and stress of scrambling to purchase items. gifts at the last minute, âshe says.
Creating a budget can be as simple as mapping out your vacation expenses, either using pen and paper creating an Excel spreadsheet or downloading a budgeting application. Whichever method works for you, it’s important not to start the New Year in a deeper hole than you expect. And, if saving money is a priority for you, consider using a cash back credit card for immediate savings.
In addition to planning ahead and creating a budget, you can also begin to strategize for the credit cards that will best suit your spending habits. Banks continue to launch huge credit card welcome offers that can be a great way to earn a load of points or cash back rewards for your holiday shopping spending.
For example, the Chase Sapphire PreferredÂ® Card is currently offering 100,000 Chase Ultimate Rewards points after spending $ 4,000 in the first three months of card membership. It’s worth $ 1,250 when used through the Chase Travel portal.
Or if you need some flexibility when it comes to spending, you can consider an introductory 0% APR card like the CitiÂ® Double Cash Card, which offers a generous 0% interest period so you don’t have to pay off your balance until 2022. Balance transfers must be made within four months of opening the account.
Check out our list of the best credit cards for holiday shopping to find out which card can get you the best return on your spending.
This holiday season is going to be tough for many shoppers, especially those who wait until the last minute. Due to several issues in the retail and manufacturing space, your safest bet to getting the items you want, and at the best price, is to start early.
Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.