What: Nordstrom Rack is increasing its use of pack and hold inventory by 2 or 3 times to mitigate supply chain disruptions into 2022.

Why it is important: Nordstrom Rack will buy larger quantities of relevant items when they are available and hold a portion of it for deployment in periods with high demand, tight supply, or system constraints.

The retailer expects its inventory levels to remain elevated through the end of the fiscal year as it invests in pack and hold at Rack and ships products earlier to meet holiday demand. The company will also pull volume forward for spring products in the next two quarters.

Nordstrom had used the pack and hold tactic to build inventory during a period of aggressive store expansion. Now the company will use the strategy to bolster its ability to maintain sales despite supply chain disruptions.

Nordstrom leverages pack and hold inventory to mitigate supply chain risk