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Target, Best Buy, etc are going to slash prices to move inventory

Melensdad

Melensdad

Jerk in a Hawaiian Shirt & SNOWCAT Moderator
Staff member
Kinda saw this coming from about 1/2 mile away. Supply lines refilling as the economy starts to tank and whammo we see inventory building but nobody buying. Stores are going to be putting stuff on sale. If you are looking for large appliances and other items, might want to wait a couple more weeks to see the sales appearing in the papers.

Full story at the Daily Wire:
www.dailywire.com

Target To Slash Prices For TVs, Furniture Because Of Inventory Glut

Target has revealed it will slash prices in order to reduce its inventory. The plethora of TVs, furniture and kitchen appliances stacked up at Target stores are taking up room that the franchise would prefer to stock with items such as food, household essentials and beauty products. “We thought...
www.dailywire.com www.dailywire.com

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Target To Slash Prices For TVs, Furniture Because Of Inventory Glut​

Hank BerrienJun 8, 2022​
Target has revealed it will slash prices in order to reduce its inventory.​
​
The plethora of TVs, furniture and kitchen appliances stacked up at Target stores are taking up room that the franchise would prefer to stock with items such as food, household essentials and beauty products.​
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“We thought it was prudent for us to be decisive, act quickly, get out in front of this, address and optimize our inventory in the second quarter — take those actions necessary to remove the excess inventory and set ourselves up to continue to be guest relevant with our assortment,” Target CEO Brian Cornell told CNBC.​
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. . . Walmart stated that their customers are eschewing discretionary purchases because of the price of gas and groceries.​
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“Over the past several weeks, we’ve continued to assess the broader retail environment and I think it’s no secret right now based on what’s been reported, the level of inventory across all retail is pretty high,” Target CFO Michael Fiddelke stated.​
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. . . “Last month, Richfield-based tech retailer Best Buy announced it would prepare for a ‘slowdown’ in sales as it reported higher operating costs than predicted for the first quarter of 2022.”​
​
Kyle Goldschmidt, an assistant professor at the University of St. Thomas’ Department of Operations and Supply Chain Management, explained that the glut of inventory resulted from shipping delays as companies ordered products in advance.​
. . . ​
 
Throw a wrench or two into a humming economy and this is what you get.

Fir those of us involved with the manufacture and supply of retail goods, this has been a nightmare.

I can get 80% of my components but I cannot execute a finished product. This tie's up capital and fills the warehouse with essentially useless materials. Add to that a lack of available labour. Once materials arrive, we cannot get enough labour to produce. Our label supplier could not get label stock. Once he could, I could not get enough wrapping film. Later when we had both, we could not get boxes to pack out.

I had two major sampling contracts canceled because the customer could not supply the product for us to wrap and kit up for them. Our embarrassment was averted because in truth, I had no labour with which to manufacture the product had it arrived. When they called to let us know we weren't getting the work we were relived yes, but it was a $400K project.

How then do I pay the rent?

Just in time manufacturing, AKA the "Toyota system," cannot function is such an environment. So, retailers and manufacturers have been loading up inventories, tying up cash, labour potential, capital, and real estate, only to find nothing is moving. The result is an economy falling over on itself.
 
Just one more shoe to drop on the economy. Fuel and food inflation is going to cause deflation of non essential items. Then the company that produce the items will drop there prices until they can not make a profit. If the demand doesn't pick up at this point they close the doors and those goods will no longer be available. Round and round she goes, where she stops nobody knows.
 
m1west said:
Just one more shoe to drop on the economy. Fuel and food inflation is going to cause deflation of non essential items. Then the company that produce the items will drop there prices until they can not make a profit. If the demand doesn't pick up at this point they close the doors and those goods will no longer be available. Round and round she goes, where she stops nobody knows.
Click to expand...
SURE we know.
We been here before.
Nobody studies History any more.
See "the Weimar Republic" circa 1930.
It was a proximal cause of a world war.
People were burning paper money to keep warm when a crazy guy from Austria came along and started pointing fingers at his idea of the cause.

Stagflation is cruel. High unemployment, high inflation and decreased demand.
There will be real hunger in this country soon.
Homelessness will double.
Unemployment above 10% (way above).
Inflation at 12%.
Crime will soar as people get hungry.
 
I went to a local furniture store recently, to pick something up for a daughter. I had been there before over the years
but did not expect to see what I saw. you go to the warehouse behind the store for pickup. (Slumberland) That warehouse was packed!
I have never seen them with what looked like double the regular inventory.

I am thinking about now someone may have realized they made a huge mistake.
 
huge mistake?
well, not really. they assuming like all past history we were ready to move on now that the covid crap is over.

they did not count on the efforts of the Biden administration to cripple the economy and reduce the nation to a bunch sniveling 'where's my check' individuals.
 
chowderman said:
they did not count on the efforts of the Biden administration to cripple the economy and reduce the nation to a bunch sniveling 'where's my check' individuals.
Click to expand...
Amen brother.
And all they had to do was listen to him. He said he would do it ...
300 H and H said:
but did not expect to see what I saw. you go to the warehouse behind the store for pickup. (Slumberland) That warehouse was packed!
I have never seen them with what looked like double the regular inventory.
Click to expand...
SOON, there will be a big sale, and they'll sell that stuff for less than what it cost them.
THEN, there will be a 'store closing' and 'everything must go' sale, and people will lose jobs.
And stagflation will roar.
 
I was the maintance planner for a large papermill I saw this comming 2 years ago when I was trying to find parts from the oem they were out to 300 days headed to 400 days for parts.
I started having parts removed reversed engineered put back in the machine during the outages and had local machineshops making them about 90% of the time the form fit and function was ok the other 10% we had to rework the parts.
Even the reworking wasnt a major issue because we have scheduled outeges every 5-7 weeks

I'm glad I retired from that but not glad the economy is in the tank so my dollar isn't going as far as I hoped
 
Im seeing lots of toys, boats, motorcycles lifted trucks etc. go up for sale around me. I think the folks that were making it with a margin, no longer have the margin. And the ones that were barley making are not making it anymore. Can you imagine making $15.00 - $20.00 an hour driving a 100 mile round trip for work in a old lumpy car, then pay double for everything else.
 
m1west said:
Im seeing lots of toys, boats, motorcycles lifted trucks etc. go up for sale around me. I think the folks that were making it with a margin, no longer have the margin. And the ones that were barley making are not making it anymore. Can you imagine making $15.00 - $20.00 an hour driving a 100 mile round trip for work in a old lumpy car, then pay double for everything else.
Click to expand...
Due to high gas prices it seems that motorcycles are in high demand now so people who have multiple motorcycle are finding it easy to cash out of some of their excess motorcycles. It becomes a win-win for the buyer and the seller.
 
FrancSevin said:
Throw a wrench or two into a humming economy and this is what you get.

Fir those of us involved with the manufacture and supply of retail goods, this has been a nightmare.

I can get 80% of my components but I cannot execute a finished product. This tie's up capital and fills the warehouse with essentially useless materials. Add to that a lack of available labour. Once materials arrive, we cannot get enough labour to produce. Our label supplier could not get label stock. Once he could, I could not get enough wrapping film. Later when we had both, we could not get boxes to pack out.

I had two major sampling contracts canceled because the customer could not supply the product for us to wrap and kit up for them. Our embarrassment was averted because in truth, I had no labour with which to manufacture the product had it arrived. When they called to let us know we weren't getting the work we were relived yes, but it was a $400K project.

How then do I pay the rent?

Just in time manufacturing, AKA the "Toyota system," cannot function is such an environment. So, retailers and manufacturers have been loading up inventories, tying up cash, labour potential, capital, and real estate, only to find nothing is moving. The result is an economy falling over on itself.
Click to expand...
You got that right.
Much of stability in retail depends widely on stock moving at a reasonably timely rate.
In manufacturing an unstable supply chain can seriously affect production.
A glut in stock can be as detrimental as a lack of resources.
Considering wholesale costs its a fine balance fo how much you can sacrifice markup and still maintain a profit.
If consumers are not buying due to economic hardship stock can accumulate and interupt a flow of merchandise.
Durable goods will last a long time and usually are not purchased in vast quantities unless they have a rapid turnover.
Perishables are an even finer balance to maintain, they must be moved before their use by dates or the risk spoilage loss.
Produce must be moved rapidly (preferably within a couple days of recieving them)
Each business though will have different logistics to deal with so one business type will often not work on another.

Excuse a few spelling goof from time to time,
Posting from a cellphone can be a real pain in the arse🤣
 
Melensdad said:
Due to high gas prices it seems that motorcycles are in high demand now so people who have multiple motorcycle are finding it easy to cash out of some of their excess motorcycles. It becomes a win-win for the buyer and the seller.
Click to expand...
In my area it's a fire sale on motorcycles. I just got a very good deal on a 2011 V-rod muscle. About a month ago, I got an insane deal on a custom chopper. I monitor the local Craigslist and there are tons of really good deals on lightly used bikes. At the moment I have 5 bikes and have run out of space. I'm probably going sell one just because of storage issues. I think it is a buyers market ... not a sellers market.
People are selling their excess toys due to the state of the economy. I suspect sales of new inventory are not as high as they were a year ago.
 
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