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Retail Inventories Increase 5.6% Year Over Year in February

two retail workers in warehouse with inventory

Retail inventories increased to $808.8 billion in February.

That figure is 0.5% higher than January and 5.6% higher than it was a year earlier, the Census Bureau said in a Friday (March 29) press release sharing advance economic indicators.

The bureau also revised its previously released figure for the percentage change from December 2023 to January, raising it from a 0.4% increase to a 0.5% increase.

The retail inventories figure is adjusted for seasonal variations and trading day differences, but not for price changes, according to the release.

This report comes at a time when retailers are reportedly embracing “just-in-time” inventory management once more after years of excess stock.

Having sold off the goods that collected in stores and warehouses since 2022, merchants have shifted their focus to restocking instead of holding onto product in case of supply chain issues, the so-called “just-in-case” strategy.

In addition, brands are gaining real-time insights on inventory in stores to ensure their products are properly stocked and presented in those retail locations.

They are doing so with signal-based merchandising solutions that use image recognition and machine learning algorithms to collect and analyze real-time, in-store data points from high-traffic shoppers via mobile app, David Gottlieb, chief revenue officer at Trax, told PYMNTS in an interview posted March 1.

“Whether it’s in Walmart or Target, we have more than one shopper in every one of those outlets every single day so we’re essentially [getting] a sense of what products are available for sale to the shopper on a day-by-day basis,” Gottlieb said.

In another development around inventory, Gather AI said Wednesday (March 27) that it raised $17 million to scale its computer vision and artificial intelligence (AI)-powered warehouse inventory monitoring offerings. The company aims to solve supply chain issues with richer data and AI.

The Census Bureau also released wholesale inventories for February on Friday. This figure rose to $901.1 billion, up 0.5% from January but down 1.6% from February 2023, according to the press release.

The monthly increase in wholesale inventories marked a shift from the change seen from December 2023 to January, which saw a 0.2% decrease. That figure remains unrevised.