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Zero Hedge
ZeroHedge
7 Feb 2023


NextImg:Ahead Of "Tsunami Of Returns", Excess Inventory Continues To Hang Around

By Dan Berthiaume of Chain Store Age

Like a post-holiday hangover that just won’t go away, many retailers are struggling with unsold products even after holding New Year sales.

According to a new survey of 500 U.S. retailers from e-commerce inventory planning software provider Inventory Planner, 50% of respondents still have goods they cannot sell after post-Christmas and January discounting. Close to half (46%) of respondents say this is a “major concern.”

More than half of U.S. retailers (53%) told Inventory Planner there would be ‘dangerous ramifications’ for their business if they failed to sell excess stock.

Close to six in 10 (58%) fear they will be left with no choice but to liquidate their excess stock.

Respondents also indicated that in many cases, they have some issues managing and tracking excess inventory:

“Excess stock is a huge issue for US retailers at this time of year,” said Inventory Planner chief marketing officer Sara Arthrell.“And a tsunami of returns which always comes in January and early February after peak trading is going to make these problems even worse.”

A recent BDO survey of retail CFOs indicates that to prepare for a potential recession, 49% of retailers are focused on reducing their excess inventory. Other top strategies include adjusting the cost structure of SKUs to create liquidity ahead of a potential recession (47%) and increasing promotional sales and discounts (43%).

For more details on the Inventory Planner survey, click here.