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Major US retailers cancelling orders to manage excess stock

Some US retailers are cancelling suppliers’ orders to prevent build-up of stock in their warehouses and stores.

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A number of key US-based retailers are reportedly taking immediate action in order to cope with unsold goods that have accumulated during recent months. In some cases, this has led to these companies cancelling suppliers’ orders to prevent any further build-up in their warehouses and stores.

A contributory factor causing this situation is a proportion of consumers apparently limiting their purchases of non-essential ‘discretionary’ items, including apparel. One large retailer stated that it had reduced its inventory exposure in discretionary categories throughout the second quarter by cancelling orders for such goods valued at more than USD 1.5 billion (GBP 1.3 billion), in addition to marking down products.

Some brand owners have taken steps to compensate for cancellations by cutting their own orders through the supply chain, whereas other providers have not reported experiencing any reduction in ordering levels from retailers. 

Interestingly, the US Commerce Department has advised that footwear imports for the first six months of this year totalled 1.35 billion pairs – a growth of 27.4 per cent over the first half of 2021. The main supplying nation was China, which exported 783.7 million pairs to the USA (said to be a rise of 28.8 per cent when compared to the figure recorded between January and June of last year.

Second on the list was Vietnam, with exports of 311.7 million pairs – an increase of 11.9 per cent when compared to the same period in 2021.

Publishing Data

This article was originally published on page 2 of the September 2022 issue of SATRA Bulletin.

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