Omnichannel

Retail leaders: Supply chain will spike prices, cause product shortage

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November 1, 2021

Every retail leader polled in a First Insight survey expects supply chain disruptions to affect prices, promotions and sales, according to a press release.

The survey was conducted by First Insight and the Baker Retailing Center at the Wharton School of the University of Pennsylvania.

Fully 100% of the senior executives polled agree disruptions will mark the holiday shopping season, and nearly all (99%) agree supply chain issues will continue impacting the retail sector through 2022 and beyond, according to a press release.

"Over a third of retailers are absorbing the hit and keeping prices consistent; however, an astounding 59% of retailers said they will be passing on the cost to consumers. For this holiday season, we anticipate that consumers are going to bear the brunt of this disruption through increased shipping and product prices," Professor Thomas Robertson, academic director of Wharton's Baker Retailing Center, said in the release.

Consumers can expect fewer sales and promotions this holiday season, with 22% of retailers saying that they will eliminate or reduce planned promotions in response to lower inventories and higher prices.

Furthermore, nearly two-thirds of retailers anticipate a margin hit of less than 10%.