UK rings in biggest-ever Black Friday sales day

Here is the marketplace news that captured our attention this week.

UK rings in biggest-ever Black Friday sales day

The UK has rung up its biggest Black Friday sales day ever, data suggests, with shoppers spending more than one-fifth more than last year as the high street bounced back from pandemic lockdowns.

The number of payments via Barclaycard, one of the UK’s biggest debit and credit card issuers, were up 23% between midnight and 5pm compared with the same period in 2020, when most of the UK high street was in lockdown, and was up 2.4% on 2019.

However, Rob Cameron, the chief executive of Barclaycard Payments, said he did not expect total sales to be too far ahead of 2019 as some more expensive items, such as kitchen appliances and electronics, were not selling as well because of supply problems.

He said independent businesses were benefiting from the return to high streets but restaurants, cafes were likely to be the big winners as families and friends made the most of being able to gather together again.

Nationwide said its customers had made 5.95m purchases by 5pm, 26% up on last year and 24% up on 2019. Mark Nalder, head of payments at the building society, said: “Black Friday spending has continued in line with our expectations and is still shaping up to be the busiest shopping day of the year.”

Despite online retailers’ fears of a slowdown after last year’s surge in internet sales prompted by high street store closures, the logistics technology group Metapack said it was on course to handle more parcels than on Black Friday 2020.

Better sales of clothing, leisure and sports items helped offset lower volumes of toys, electronics, technology and homeware, all of which have been affected by delays in supplies from the east and south-east Asia.

Retailers, including the specialist AO.com and John Lewis, have said Black Friday sales could be hit by potential product shortages because of limited supplies of microchips, factory stoppages in the Asia-Pacific region caused by the pandemic and problems with international shipping.

John Lewis said it had seen a “brisk start” to trading on the day with demand for beauty and fashion particularly strong, as the UK prepares for its first Christmas party season in two years.

Health and beauty specialist Boots said it had experienced its busiest hour of online trading all year on Friday morning, with three orders a second coming in.

The surge in sales comes despite disquiet about the spending spree, with Amazon’s largest UK warehouse blockaded by climate activists targeting the global online retailer on its busiest day of the year.

About 20 Extinction Rebellion activists stopped lorries from entering the company’s Scottish distribution centre in Dunfermline from 4am. The group said it was also protesting at sites in Doncaster, Darlington, Newcastle upon Tyne, Manchester, Peterborough, Derby, Coventry, Rugeley, Dartford, Bristol, Tilbury and Milton Keynes.

Tambo’s View:

The UK has had a strong Black Friday in comparison to the US where sales actually decreased for the very first time from $9 billion in 2020 to $8.9 billion in 2021. This is a testament to the UK's strong retail market and the above figures consolidates the UK's shift to digital commerce.

E-Commerce Giant MercadoLibre Raises $1.6 Billion in Share Sale

E-commerce retailer MercadoLibre Inc, Latin America’s most valuable company by market capitalisation, has raised $1.55 billion in its first equity offering in over two years.

The company sold a million shares at $1,550 each, according to a press release, representing a discount of about 5% to Monday’s closing price. The company looks to spend the proceeds on general corporate purposes.

MercadoLibre has boomed since 2020 as the coronavirus pandemic led a growing number of Latin Americans to buy more online and increasingly turn to digital payment options. The company continued hitting milestones in the third quarter: on the e-commerce front, it posted record gross merchandise volume of $7.3 billion, while its fintech arm saw its credit portfolio grow to over $1.1 billion.

The company last sold shares in March 2019, when it raised $1.9 billion through a public share offering that included a direct investment from companies including PayPal Holdings Inc. Earlier this year, the company sold $1.1 billion in bonds that included a $400 million tranche of sustainable debt. At that time, it said part of the proceeds would be used for the expansion of its electric delivery fleet.

Tambo’s View:

Following this raise in capital, MercadoLibre could find its upcoming investments and expand its logistics capabilities, services and products, as well as increase its inventory bargaining power. These funds and subsequent investments would ensure that Mercado Libre remains South America's number one marketplace ahead of Amazon which comes in at close second.

Nubank moves into e-commerce

Brazilian digital banking giant Nubank has teamed up with a number of retailers to add an e-commerce section to its app.

At launch, the bank's tens of millions of customers in Brazil will be able to shop at retailers such AliExpress, Dafiti and Magalu through the app, with more partners in the pipeline.

Launched in 2013 with a core credit card product, Nubank has expanded to offer personal lending, life insurance, products for micro entrepreneurs, instant payment services and investment products.

Since July, it has included offers of products from partnerships in its app, with international transfers from Remessa Online, and more recently, auto loan equity from Creditas.

The latest diversification play comes as Nubank gears up for a listing in the US at a valuation expected to be in excess of $55 billion.

Tambo's View:

This announcement marks Nubank's entry into e-commerce; the digital bank will now be able to diversify its product offering and go beyond finance. By combining the banking and shopping experience, Nubank will be able to further provide services in many other areas of customers' lives, making the overall experience of banking and shopping easier and more seamless. We expect more banks to make similar announcements.