Retail Inventory Glut Is About To Get Ugly

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The retail industry kicked off the crucial fourth quarter of 2022 weighed down by the same inventory imbalance that greeted it in the first quarter, with the added prospects of subdued holiday sales and an anemic first half of 2023. 

“I hesitate to call it a blood bath,” Urban Outfitters CEO Richard Hayne recently told analysts. “But it’s going to be ugly in terms of the amount of discounting and markdowns.”

The latest casualty of note is Nike, considered among the best-managed brands in the apparel category. Nike gear had been hard to find at the start of 2021 as new merchandise was anchored in containers offshore. 

Meanwhile, cooped-up consumers, flush with pandemic stimulus payments, began emerging from their pods to purchase exercise equipment and athletic leisure wear. Nike placed its manufacturing orders betting that the robust demand would endure. 

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