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Big Retailers Cut Down on Holiday Stock
While Amazon and e-commerce continue to challenge brick-and-mortar retailers, big department stores are cutting their inventory orders in preparation for the holiday shopping season. Macy’s Inc., Nordstrom Inc., and Dillard’s Inc. are just a few of the big retailers who are purchasing smaller batches with shorter lead times this year.
By relying on a more dynamic demand forecasting process than in previous years, the companies are taking a conservative approach to prevent excess stock and inevitable markdowns following the holidays. However, there’s a balancing act as these companies risk running low on inventory should the projections be off.
With this outlook, large department stores are mirroring the strategy of “fast fashion” retailers like Zara and H&M, who consistently keep low inventories and attract customers with lower price points.
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