Black Friday got its name because, for many retailers, this day marks the point in the calendar year when their bottom lines begin tipping toward the black, often the first time since the previous year’s Christmas season. It’s a critical few weeks for retailers, including local merchants, many of whom will participate in Small Business Saturday this weekend.
The 30th annual Holiday Survey from Deloitte University offers some insight into what consumers plan for the next three weeks of holiday shopping. As with every year since the depth of the great recession in 2008, consumers expect to spend the same or more on gifts, outings and decorations than last year. Nineteen percent said they expected to spend more, the highest percentage since 2000.
When asked why, 41 percent of these folks said they could afford to spend more because their household financial situation had improved. Contrast that figure with another: Two-thirds of Americans think the country is on the wrong track, according to weekly Rasmussen polls.
Although personal income has remained relatively flat, lower fuel prices — both for driving and heat — have left more money in people’s pockets. A gallon of gasoline in New England costs 82 cents less this year than it did a year ago, and heating oil is about $1 less per gallon.
Home prices also are rising, and unemployment is down.
So, what are people spending money on? Gifts, of course. Survey respondents say they planned to spend an average of $487 on gifts, a 6 percent increase over last year. They expect to give an average of 14, well below the 23 gifts they expected to give in 2007. The biggest spending gains will be on holiday decor and non-gift clothing — 33 percent and 26 percent respectively.
Not to spoil any surprises, but the most common expected gifts — to give and receive — are clothing and gift cards.
Nearly half of the holiday survey respondents said they will shop online. The convenience is great, but buying gifts at locally owned retailers will do much more for your local economy. About half the money spent at local shops, restaurants and other business is recirculated locally, compared with just 14 cents of every dollar spent at a big box chain (it would be even less for an Internet retailer, many of which have no brick-and-mortar community presence).
Local retailers also pay local and state taxes and contribute more generously to local charities. They also create local supply chains by purchasing products and services from nearby suppliers.
Saturday is Small Business Saturday, a shop-local day first designated in 2010 by American Express. Businesses in many communities will offer special deals and treats. In Bangor, for example, many downtown shops will offer discounts up to 25 percent.
Sen. Susan Collins and Seth Goodall, regional administrator for the Small Business Administration, kicked off a national Small Business Saturday initiative with a tour of four downtown Bangor businesses on Wednesday.
“Small businesses on Main Street are the heartbeat of our communities. It is important to support them because they employ our family and friends and make our towns vibrant,” Goodall said in a statement.