Why do department stores have huge sales after
Thanksgiving and Christmas?
Every year, after both the Thanksgiving and Christmas holidays in the
United States, each department store has a huge sale. Have you ever wondered
why this is so? Or how the stores can keep their profit by allowing clothes, shoes,
and accessories to be discounted at up to 50 or even 75% off? In America, it is a
known fact that people enjoy sales. The stores know that people will be willing to
buy more at a reduced cost, but how does this affect the store’s profit? How can
they allow for such great discounts? Retailers know that these huge sales will
influence customers to shop at their stores and therefore are willing to reduce
their prices. In addition, many department stores have sales because they fear
competition from others.
One possibility for why the stores have huge sales is because they are
afraid people will buy online instead. In today’s society, more and more people
find it much easier to shop in the comfort of their own home rather than having to
wait in long lines at a department store, especially during the Holiday season.
Often times, department stores host in-store sales only. Having in-store sales is
an incentive for people to come to their stores instead of buying online.
Department stores know that people are more concerned with the
opportunity cost of the product than the actual cost of the product. In the United
States, some people are lazy and do not feel like getting into their cars and
driving to the mall when they can simply buy the items online. This is especially
true with the high gas prices that the United States has faced lately, making our
society one in which people are willing to spend more on shipping and handling if
it means not having to waste gas. Some would prefer to spend more money
buying online than wasting their time waiting in a line at the stores. Others prefer
going to the stores to avoid shipping and handling costs, but stores may be afraid
that not all people will choose this route. During the Christmas season, more
people are adapt to spend a lot of money and are more willing to wait in lines to
save money with a bargain.
Department stores know that every other store
will be having a sale, so in order to compete or earn a profit they too must have a
sale as well.
It is also known that department store sales have fallen due to other
options of shopping. Ebay and Amazon serve as huge competition to department
stores. Customers can find better bargains for the same products and they do not
even have to leave their home to buy them. Amazon even has the same shipping
price for any product which makes it easy for customers. Most of the time, Ebay
and Amazon offer a better deal than a department store. If a department store
offers sales, some Ebay and Amazon customers may be willing to shop in the
stores instead of online.
According to an article from the Milwaukee Journal Sentinel, department
stores are doing more to get customers to come in their stores. One thing the
article said is that “more retailers are expected to use in-store kiosks that will
allow customers who can’t find their size or desired color in the store to order
online instead” (Hajewski). Having in-store kiosks eliminates the possibility of
customers shopping online or at another store if they can’t find what they want
there. Only time can tell the future of the success of the American department
store. However, it is certain that department stores will do their best to ensure
that in a technology- dependant age such as today they are staying competitive.
Works Cited
Hajewski, Doris. "Holiday retail sales may not be so jolly." Milwaukee Journal Sentinel
[Milwaukee ] 10 Nov. 2007. Milwaukee Journal Sentinel. 16 Nov. 2007
<http://www.jsonline.com/story/index.aspx?id=684545>.