Amazon has issued a warning to online retailers ahead of the usually frantic Christmas period.
The eCommerce giant forecast a slowdown in sales ahead of the key holiday shopping season, which usually starts with Black Friday on Friday 25 November.
Amazon’s finance chief said that consumer spending was in ‘uncharted waters,’ as the company’s share price value dipped by an initial 10%.
In recent years, Amazon has become a bellwether for other retailers. The forecast could be a gloomy signal for other companies selling online. It could also directly affect smaller online retailers that sell via Amazon’s platform.
Christmas is normally a boom time for online sellers. Some retailers rely on a bumper Christmas to help get them through leaner months throughout the year.
This year, however, rising costs and higher interest rates could lead to belt-tightening by some shoppers.
A forecast for UK retailers from TheVoucherCodes.co.uk suggested Christmas sales could dip by 3% to £82.2 billion in 2022.
This would mean Christmas sales were down £2.5 billion compared to 2021. They would still be higher than Christmas 2020, where sales reached £79.7 billion.
Miles Grady, Director of CloudAccountant.co.uk said:
“Many online sellers have found it tough over the last few years. The ongoing cost-of-living crisis could force more shoppers to cut down on their Christmas budgets.
As we head towards the holiday season, online sellers need to make sure they have a clear plan to help attract shoppers. This could mean offering early discounts to help customers spread the cost of Christmas.
Online sellers also need to make sure they can be competitive on price. One of the best ways to do this is to use online accounting software like Xero to track all of a shop’s financial information. Having financial information at your fingertips means you’ll be able to make better decisions to make the most of any sales events.”
Want to learn more about Xero and how it can help online shoppers? Get in touch here or call: 0808 281 0303.