Contrary to popular belief, being practical wasn’t always the way of the consumer. In the late 18th century, grocery store owners from Philadelphia to New York were putting their mark on the holiday shopping season by giving their customers a bigger share of the profits for shopping early. Then, something unexpected happened: people started hoarding.
“It really should be said that the people who own stores in the winter are the ones that give away the most in savings,” says Raul Heilbroner, founder of R&R Empty Pantry, a site dedicated to revealing the hidden costs of storage. “If you’d like to start buying things instead of freezing them, you have to be ready to participate in the early season.”
In the late 18th century, Mr. Heilbroner says, word got out that he could get great deals on food and drink for his store by selling it earlier than other stores could.
And besides saving money, the strategy also meant that a convenience store owner had more stock for when business really picked up. This seemed to make the most sense to customers who weren’t as interested in spending hours shopping before Thanksgiving to get the items they needed.
“People used to appreciate that we could come in and find something that they did not know existed or that they did not expect to find,” Mr. Heilbroner says. “I hope we get back to that concept, but there is still a lot of product available to buy at any time.”
It’s unclear how long this strategy will continue to work, but it clearly worked in Philadelphia from about 1774 until 1775, where the stores stored almost all their supplies until November. In the eastern seaboard cities, the stores actually stayed open until the Thanksgiving Eve.
From 1760 to 1767, Philadelphia’s grocers gave away 28% of the profits for shopping in the weeks before the holiday, Mr. Heilbroner says. Then, just before Thanksgiving, they gave back only 4% of the profits, or $125, which meant a huge return for those who waited.
Looking to the Great Recession for example, where large retailers like Sears and Best Buy closed stores, trying to make money instead of saving it, a more logical strategy would have been to offer early Black Friday sales.
“A rational company might have decided to respond to the opportunity, but the fact that they didn’t means that the competition would have done the same thing,” Mr. Heilbroner says. “No rational person would have done this.”
But late 18th century stores wanted to be at the forefront of the trend. With the opening of grocery stores in some places in the late 1700s, early Black Friday could not have happened without this competition for the big profits.
Some retailers are still hoping to save money this year by maintaining their schedule of giving away stocks throughout November. And at least they have the advantage of cold weather to keep their sales going. But, for some consumers, the early season stores offer something a little better than big savings — products they really do not need and get ready to use up pretty quickly.
“People can justify having some of that stuff as a precaution, just like you might use it up right away,” Mr. Heilbroner says. “When you have people taking advantage of the early season, they will probably get rid of most of it before Christmas.”
-by Vince Lewis-Getty