Some people padded their savings accounts by staying home during the pandemic. And some set aside the advance payments of the child tax credit they received, points out Amna Kirmani, marketing professor at the University of Maryland’s Robert H. Smith School of Business.
But consumers who are ready to spend will face the retail impacts of the continuing pandemic, supply chain interruptions and inflation.
Labor Day savings may not be as easy to spot this year, either online or in person. In fact, for some product categories, there might not be discounts at all.
Here’s what you need to know about the sales — and why you may have to work a little harder to find what you’re looking for on Sept. 6.
Ramping up production after last year’s COVID-19 shutdowns has led to ripple effects in the retail world.
“We have consumers who are believed to have quite a bit of money in their pockets, but the retailers do not have a lot of product,” says Tom Arnold, professor of finance at the University of Richmond’s Robins School of Business in Virginia.
“The supply chain issues are very real in that the retailers are having a difficult time getting product, and when they do get product, they are facing a higher cost for the product.”
That means some retailers are struggling just to fill their shelves. And if these stores don’t have much inventory to sell in the first place, they won’t be as motivated to discount the items they do have in stock.
Here’s how a retailer might be thinking about inventory: “In past years, I could have 100 units, thinking I could sell 50 at regular price, the next 30 at 25% off and then clear out with half-price,” Arnold says. “Well, this year I might only have 50 units and I might be able to sell all of them at regular price.”
As a result, Labor Day staples like car sales, appliance deals and mattress markdowns might not be a given in 2021 — or, not as impressive.
Products in low supply aren’t expected to be discounted much, if at all. That’s the case with some cars, Kirmani predicts.
You will, however, be able to find deep discounts on summer-related merchandise. Retailers will be motivated to unload whatever warm-weather inventory they have left over before consumers transition to fall. You can also expect clothing deals, as Labor Day falls within the back-to-school shopping season.
Promotions are expected to take place at big-box retailers, home improvement outlets, department stores and tech giants. For example, Wayfair, Best Buy and Macy’s have been known to offer Labor Day savings.
But, again, prepare for some of the discount levels to be modest.
“I think as far as Labor Day sales, they’re not going to be as good as they have been in previous years,” Arnold says.
If you choose to shop over Labor Day weekend despite the challenges, here’s how to maximize your money and increase your chances of finding a good deal:
The bottom line? Arnold says you can find some “good” deals this Labor Day, but they won’t be “fantastic.”
This article was written by NerdWallet and was originally published by The Associated Press.
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The article Be Ready to Work for Labor Day Bargains This Year originally appeared on NerdWallet.