Big retailers like Target and Walmart have been seeing large amounts of excess inventory — which could be a good thing for companies helping to do away with the oversupply, The Wall Street Journal reported Monday (July 4).
Some companies, including Liquidity Services, Xcess Limited and others, are seeing a large amount of overstock on items like kitchen appliances, televisions, outdoor furniture and clothes, which have been marked for clear-out by big companies.
In many cases, the companies are picking up pallets at ports or from warehouses, with the goods in question never even making it to the floor of the stores. Instead, the liquidators have been selling the goods to smaller companies or even individuals who resell things online.
The report noted that the beginning of the pandemic, now over two years ago, saw many retailers canceling orders from overseas suppliers, with shoppers mostly staying home.
That changed as the economy eventually opened up, and supply chains became backed up due to factory backlogs and shipping delays. In an attempt to navigate these delays, many companies began to order extra items, placing those orders further in advance to make sure they got there on time.
However, customer preferences have changed, and many items that were popular during the height of the pandemic — such as home items and more leisurely clothing — are no longer what customers are looking for. Instead, customers have been buying more expensive, dressy clothes and increasing spending on travel and entertainment, although inflation is again changing spending patterns.
PYMNTS wrote that inflation has walloped the U.S., and recent Consumer Price Index data shows that that the prices for food consumed at home were up a bit more than 10% year on year.
The report noted that the money spent on the Fourth of July weekend is “borrowed from the future,” with statistics from the American Farm Bureau Federation indicating that the total cost for a 10-person cookout is up 17% compared to last year.