What: High volumes of unsold merchandise after supply chain issues and uncertain client demand post-pandemic do not guarantee success for value retailers.

Why it is important: Following the reactions to pandemic-related issues, retailers now hold high volumes of merchandise which can be a big opportunity for off-price sellers as inflation looms.

The landscape seems to be perfect for off-price retailers, however, the pandemic caused a similar ordering boom. As these companies’ core customers were flush with stimulus cash from the government, value retailers also are seeing rising inventory levels and sales drops. Just like traditional wholesalers, off-price must be agile and strategic when buying merchandise.

In addition to navigating their own inventory overload, off-price retailers will need to compete with second-hand and resale channels that also target a price-conscious shopper.

In order to compete, off-priced retailers should look to improve their operations by incorporating digital functions. Ghost, a platform connecting brands to the right buyers, appears to be optimizing the process.

Threats to off-price retail