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A 26% increase in inventories since this time last year has added up to $44.8 billion between S&P consumer indexes with a market value of at least $1 billion and reported earnings in the last two weeks, according to a Bloomberg report. Target reported a 43% increase in inventory, Walmart reported a 32% increase, Macy’s reported a 17% increase, and Costco reported a 26% increase.
Retailers will now face paying more in storage fees or issuing discounts to make room for more inventory. The latter could be especially difficult for businesses, given the steep rise in inflation. Excess inventories typically signaled a recession and/or overall economic downturns in the past. Goldman Sachs predicts a 35% chance of a recession in the next two years, while Wells Fargo’s economic model projects a 30% chance of a recession occurring in the next six months alone. END QUOTE
I've done the same in my business, even though its a B2B & not retail. Nevertheless, there are widgets I simply cannot run out of if my company is to survive, so I've stocked up big time. I've bought a year's worth and have it stowed safely away in a secured barn in Alabama.
There are all kinds of unexpected consequences cropping up from Slide'n Biden's economy...this is just another one of them.
This is what caused such high inflation at the wholesale level...retailers stocking up.
The more a person knows about business & the economy, the scarier it all appears to us for those who live paycheck to paycheck, & who don't have a year's worth of cash reserves saved....which is ~60% of Americans.
arent those excesss inventory in TGT,WMT,M,BBY warehouses higher ticket items like appliances,electronics and clothing?
They could be sold Xmas.
WMT is selling more half gallon milk instead of 1 gallon?
some shoppers are skipping ice cream and cereal
Oh the horror. Retailers are having to pay for warehouse space to keep an inventory of products. Just like it used to be. It's about time we got rid of the ridiculous concept of Just in Time manufacturing. Imagine if there had been warehouses full of baby formula when that factory was shut down.
Oh the horror. Retailers are having to pay for warehouse space to keep an inventory of products. Just like it used to be. It's about time we got rid of the ridiculous concept of Just in Time manufacturing. Imagine if there had been warehouses full of baby formula when that factory was shut down.
Just In Time has proven to be problematic with the pandemic. Look at all the auto makers that had chip shortages. Had they not done JIT, it would have delayed the effects of the shortage by having supply of chips. This was part of Toyota's problem.
With video cards inventories are going up because retailers and manufacturers want the consumers to keep paying $1000+ for them and that's simply not going to happen. I avoid buying high margin products such as flagship phones. Try lowering prices back to pre pandemic levels or close your doors and go out of business.
They are still pushing just in time where I work. Less warehouse space more machines. They lease space while allowing inept analysts that constantly run us short in inputs to seemingly keep their jobs forever and then whine when we take a half hour too long to change over meanwhile the analyst just caused 24 hours of downtime. Stuff always flows downhill.
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