Will online holiday shopping mean even more dark stores?

Now that Thanksgiving has come and gone, it’s time to look at what’s going on for the Holiday Shopping season, to see if consumer spending is looking good at the end of 2018. And the early signals from last weekend seem positive.

Cyber Monday kicked off on the heels of a record-breaking Black Friday online shopping spree, according to data from Adobe Analytics. Online sales on Black Friday advanced 23.6% from last year, totaling $6.22 billion. This Black Friday was the first time in history more than $2 billion in sales originated from smartphone purchases, Adobe noted. Shoppers chose mobile over the malls this year, with in-store traffic down 1.7% on Thanksgiving and Black Friday compared to last year, according to data from ShopperTrak. Likewise, Salesforce Commerce Cloud reported 13% year-over-year growth on Black Friday, with mobile devices accounting for 67% of digital traffic.

“E-commerce sales as reported by numerous sources indicate solid holiday sales for the Thanksgiving weekend and holiday season to date and we remain comfortable with our expectation for mid-teens e-commerce holiday season growth,” said Aaron Kessler, an analyst with Raymond James. Based on the data skewing toward digital sales, he retains a “positive bias on Amazon and Google shares,” Kessler added.

But note the bolded part, as sales in actual stores declined as people chose to shop at home. And if that trend contimues for the holiday season, it means that we are likely to see more brick-and-mortar stores closing, and malls becoming even deader.

Which makes Wisconsin's “dark store” issue all the more crucial to resolve, since the stores and malls that remain will have more dark stores to point to in as they try to lower their assessments. Recall that if existing stores and facilities are allowed to use the dark store loophole, then the property taxes of homes and other properties go up, since they take up a larger proportion of the tax base.

More of this to come?

Wisconsin voters who were asked overwhelmingly wanted to get rid of the “dark store” loophole in this month’s elections, but the greedheads at Wisconsin Manufacturers and Commerce (WMC) are going to try to keep this extra tax break going through their puppets in the WisGOP Legislature. This is all the more disgusting because businesses are getting another tax break in this year with the repeal of the personal property tax on most types of equipment,

Not only will that move cost Wisconsin taxpayers an estimated $74.4 million (as a shell game that pays the difference in property taxes to localities), but it’s yet another property tax burden shifted over to homeowners. This seems like an area where Gov-elect Evers could put WisGOP on the defensive by putting a repeal of the dark-store loophole in his first budget, and possibly match it with a repeal of this personal property tax shell game, and make the WisGOPs defend raising the property taxes of homeowners while spending $150 million+ as part of another giveaway to businesses.

Let’s see how Wisconsinites react as their property tax bills come in the mail in the next couple of weeks, as the cost of the dark store loophole and other property tax disparities are getting worse by the year. And given that more retail stores seem to go away with each Holiday Shopping season, it’s something that is going to have to be dealt with in coming months in one way or the other.