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Baltimore-area holiday rush gets a head start amid concerns over shipping delays

Cathy Clements usually puts off holiday shopping as long as possible. But not this year.

The Harbor East resident headed last weekend to the mall and Target, managing to both start and finish her gift buying. She was done nearly two weeks before Thanksgiving, when retailers typically kick off the holiday season.

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This year, not much has been typical for consumers or retailers. Supply chain problems have pushed retailers and consumers to get the season’s shopping underway even earlier than usual to avoid delays and out-of-stock merchandise.

For months now and amid a pandemic, consumers have been hearing about factory disruptions, U.S. ports jammed with container ships that can’t unload quickly and a shortage of drivers to transport parts and goods to stores and warehouses. In the Baltimore area, residents also have had problems getting mail and packages delivered by the U.S. Postal Service because of too few carriers and mismanagement, an audit found earlier this month.

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Shoppers walk past Santa's display on Thursday at Arundel Mills' food court.
Shoppers walk past Santa's display on Thursday at Arundel Mills' food court. (Karl Merton Ferron/The Baltimore Sun)

Retailers, for their part, have rushed to stock stores early and entice shoppers while stores are stocked, kicking off promotions even before Halloween.

Clements, a doctor with Mercy Medical Center, decided early on to take no chances on the jewelry, makeup and apparel she sought for friends. Judging from the busy stores and crowds she encountered at Towson Town Center mall, others had the same idea.

“I had decided, just hearing the news, to go a little bit earlier this year,” Clements said. “I just didn’t want to go to the store closer to Christmas and find out there was nothing.

“I’ve had some issues getting stuff delivered even before the holidays, so I didn’t want to risk it,” Clements added. “Right now, I don’t really trust Amazon.”

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A shopper walks past Santa's display on Thursday at the food court at Arundel Mills.
A shopper walks past Santa's display on Thursday at the food court at Arundel Mills. (Karl Merton Ferron/The Baltimore Sun)

While holiday promotions and shopping have drifted earlier and earlier each fall for years and Black Friday is no longer a single-day burst of post-Thanksgiving buying, supply chain issues are motivating consumers this year as never before, analysts said.

“They know something has gone wrong in the supply chain, and they’ve anticipated shortages,” and begun planning purchases, said Brittain Ladd, a Dallas-based retail industry analyst. “By the end of the first week of December, you want to have your shopping done.”

A confluence of factors have contributed to problems — COVID-19-related limits on overseas manufacturing capacity, and shortages of raw materials, container vessels and truck drivers — as retailers placed large orders to meet strong demand and fill depleted inventory.

“Retailers are having difficulty estimating when they are going to see the goods,” said Tinglong Dai, a professor of operations management and business analytics at Johns Hopkins University’s Carey Business School.

Despite soaring inflation, supply chain worries, and peaks and valleys of the pandemic, overall holiday sales are expected to be solid. The National Retail Federation expects sales of up to $859 billion, up 8.5% to 10.5% over 2020, which would set sales and growth records.

“Consumers are buying way more stuff than they did last year and in 2019, thanks to elevated savings, subsidies such as the Child Tax Credit program and a movement of spending from services into products,” said Neil Saunders, managing director of GlobalData. This season, “consumers are very much determined to spend what it takes to have a good time as they try to make up for subdued celebrations last year.”

Nearly two-thirds of shoppers surveyed by the retail group in early November had already begun holiday shopping, compared with just over half in a survey a decade ago. The November survey found that 46% started shopping earlier than usual this year. And more than a quarter — 28% — had completed their gift buying.

A separate study of online spending by Adobe Analytics showed 8% growth in October, but it also showed the impact of supply chain constraints. The prevalence of messages showing items to be out of stock skyrocketed by 325% compared with October 2019. Electronics had the highest out-of-stock levels, followed by jewelry, apparel, home and garden, and pet products.

Any product that requires a computer chip, a part that’s been in short supply globally, including electronics and some toys, could be especially susceptible to shortages, analysts say.

“The challenge is going to be for those retailers not able to get product online or in the store,” Ladd said. “That’s going to be a reality and could hurt overall Christmas sales.”

Earlier shopping is not expected to take away from the traditional holiday shopping kickoff. The number of people spending from Thanksgiving through Cyber Monday — 158 million — is expected to be up by nearly 2 million from last year, though below the pre-pandemic 2019 level, the retail federation says. But higher percentages of shoppers plan to go out to stores compared with last year when COVID-19 concerns kept many people home.

Area malls, where more retailers are offering curbside pickup options, expect to get their share of that traffic.

“Shopping in store is still the preferred way to shop,” said Angie Riford, marketing director of Arundel Mills in Hanover. Riford believes malls such as Arundel Mills satisfy the “real-life connection that people crave, as well as the satisfaction of walking out of the store with your product.”

On Thursday, the mall had just put the finishing touches on its Santa display with a Christmas tree and green velvet chair. Shop windows at Coach, Saks Fifth Avenue and others beckoned with “early Black Friday” deals of as much as 70% off.

Shekanda Wright, a Washington resident who brought her 9-year-old son and 12-year-old daughter to the mall for her son’s birthday, said she usually shops for holidays at the last minute. But this year, she was enticed to shop earlier thanks to buy-now-pay-later apps such as Klarna or Sezzle that offer interest-free payment plans.

“It’s prompting me to spend more,” said Wright, who works at an Express store in Prince George’s County. “Instead of, ‘When do I get paid enough to go buy gifts?’ I can buy them now at a broken-down price.”

Given the supply chain issues, consumers should expect to see less variety and fewer discounts, said Dai, of Johns Hopkins.

“Do not expect to see a lot of empty shelves,” he said. “It’s about less variety and fewer discounts and holiday deals.”

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He said retailers such as Amazon that are mailing catalogs or gift guides to consumers appear to be trying to promote fewer and more specific items than shown online. And promoting merchandise earlier in the year also helps retailers better manage inventory by spreading out traffic and demand.

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Shoppers walk behind a snowman display Thursday at the food court at Arundel Mills.
Shoppers walk behind a snowman display Thursday at the food court at Arundel Mills. (Karl Merton Ferron/The Baltimore Sun)

On Wednesday, the retail federation sought to offer a dose of assurance to consumers along with its most recent holiday sales update.

“Retailers are confident they have enough inventory on hand to meet holiday demand,” said Matthew Shay, the group’s president and CEO.

Target executives said Wednesday during an earnings conference call that they have taken steps such as putting in purchase orders much earlier than last year, secured extra capacity in rail and trucking, and diverted shipments to less-congested ports. The retailer also is adding storage capacity at more than 200 stores, which act as fulfillment centers.

“Within our supply chain, the team has been methodically working around multiple obstacles and challenges throughout the network,” said John Mulligan, COO. “While we continue to see some periodic outages across different items and categories, we are entering the holidays with a very healthy inventory position overall.”

Some retailers are more prepared than others, Ladd said. Like Target, Costco, Home Depot, Walmart, Lowe’s and Amazon took on the expense of leasing cargo vessels to circumvent logjammed West Coast ports, for instance. But retailers that hesitated or lack such alternatives, typically smaller businesses, will likely struggle more, he said.

“There will certainly be disruptions,” Ladd said. “But the retailers in the U.S. live and die by the supply chain and they take great steps to minimize disruptions. The only way to stay in business is having product to sell to consumers.”

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