Most, if not all industries have some semblance of seasonality- a period of the year in which a specific industry experiences the highest traffic in terms of business and sales. Within the freight business itself, the various industries it serves have different peak seasons. For instance, produce season is typically February through July, and even this can vary depending on which specific produce you’re shipping. This is the same for the retail industry. While there are still discrepancies in when exactly peak season is for the multitude of businesses under the umbrella of retail, there are similarities among the change in peak season over the last decade. Generally speaking, business peaks for retailers around the last 2 months of the year. High traffic volumes and the holiday season, among other things, have lent themselves to higher sales in November and December. This, more or less, has been the case in the US for the last 75 years. However, in the face of tremendous technological advancement and cultural shifts, retail’s peak season has evolved. What exactly does that entail, and what does it mean for the future of retail freight going forward?
When comparing aspects of retail from present-day to even ten years ago, there has been a great renovation in the way individuals obtain retail goods- especially in peak season. Think about Black Friday- as recently as 2010, people finished Thanksgiving dinner and eagerly awaited their alarm the next morning so that they could trek through the chaos of their local mall. If you wanted the best deal on a brand new television, you’d be bundled up at the doorstep of Best Buy before the sun gets the chance to rise. Businesses pondered why they should wait for Friday morning if they start the holiday gift rush before the sun sets on Thanksgiving. Thus, stores open for Black Friday on Thursday to get a head start on peak season. This shift began while E-Commerce was in its infancy, but as the 2010’s passed, the boom in online sales skyrocketed. It was more convenient than ever to sleep in, skip the line, and purchase your 70-inch television from the comfort of your bed. This birthed ‘Cyber-Monday’, a day dedicated to contrasting the hectic nature of Black Friday. To arm themselves with maximum profit, companies overloaded inventory to match their estimated consumer demand. This produced success for major retailers for nearly a decade- until the entire world shut down, inflation rates ballooned, and the average American was forced to stretch their dollar as far as they could.
What we see now as a result of this shift is retailers possessing an abundance of products with diminished demand and consumers who acknowledge that there are more important things to spend money on. Where will these variables lead the industry in the face of retailer’s typical peak season? For one, experts predict that this year’s peak for retailers won’t happen over the time period it usually does. Companies are offering massive discounts on their goods over the entire last quarter of the year, all in the attempt to rid warehouse space of products that have otherwise been collecting dust. This, through the lens of a consumer, is not a completely bad thing. While their financial priorities have shifted, rock-bottom prices offered by retailers seek to make up for the lessened demand. Industry experts also say that this ‘peak discount season’ will not cease once the Christmas lights come down, but will likely continue through at least the first half of 2023.
Peak season used to be open-season for retail profit, as the societal culture and financial standing allowed for it. Now that we see retailers endure growing expenses at the behest of dwindling consumer demand, the path ahead is not one that has been traveled. Through the shifts in peak season, there has never been so much ambiguity. A cultural shift back in the other direction for the population is one that simply cannot happen overnight. However, what can be mitigated by retailers is the optimal handling of future freight and the informed and educated maintenance of inventory that requires action.