6/25/09

2009 holiday season presents inventory challenge, analyst says

With many retailers under-ordering product levels for the coming holiday shopping season, merchants may face the challenge of finding enough of what turns out to be the hottest sellers, retail analyst Nikki Baird says.

Paul Demery , Managing Editor, B2B E-commerce

With many retailers under-ordering product levels for the coming holiday shopping season, merchants may face the challenge of finding enough of what turns out to be the hottest sellers, says Nikki Baird, managing partner at research and advisory firm Retail Systems Research LLC.

Many retailers rely on web-enabled price optimization and markdown optimization applications to help them set the most appropriate initial prices, followed by the most appropriately timed markdown prices to move the most merchandise at the highest possible profit margins throughout the holiday shopping season.

But because of the economic downturn this year, many retailers are under-ordering products-Baird notes that retailers’ inbound container shipments are down 16% from a year ago-which may leave merchants short on the most popular products. “It may well be that the story for this holiday season is not how fast retailers can mark down and move inventory that isn’t selling, but how quickly they can bring in more of the hottest products before they sell out,” she says. “That’s not a bad story for profits, but it could be a bad story for customer expectations and for the holiday season overall.”

Topics:

Christmas and holiday season, marketing, Online shopping, Seasons, Shopping

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