Soaring container rates to the US are prompting brands to place larger, earlier orders, risking a buildup of unsold inventory known as dead stock.
01Summary
- 01Ocean freight rates to the US have more than doubled this year.
- 02Higher costs are pushing brands to order larger quantities and earlier than usual.
- 03This ordering pattern increases the risk of dead stock if demand does not match supply.
- 04The article suggests strategies to mitigate dead stock, such as improving demand forecasting.
- 05Dead stock ties up capital and storage space, harming brand profitability.
02Why it matters
This matters because rising freight costs could lead to widespread inventory gluts, forcing brands to discount heavily or write off stock, which affects pricing and availability for consumers.
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