With the retail earnings season winding down, we now have answers to many of the previous unknowns around the holiday season.
On the supply side, one of the biggest questions was around inventory position. Retailers spent much of their year cutting receipts and discounting product. And many did it in a hurry, to realign levels to shrinking demand in order to reset for the holidays.
That came just a year after just about everybody was scrambling to acquire inventory amid supply chain constraints for the 2021 holiday season.
So it’s no surprise that many, if not most, Q4 and full-year reports showed inventory increases across sectors. Increases were both a reflection of how both supply and demand conditions changed between 2021 and 2022.
Degrees matter. Some retailers’ inventories were up a little, others by a lot. Some, like Kohl’s, were still trying to unload excess product at year’s end and retooling their strategies in 2023 to hold less inventory going forward. The rare few were the Macy’s of the world, which actually saw inventory declines after demonstrating discipline throughout the year.
Still, others were opportunists. Among the largest in that camp is TJX Cos. The off-pricer has turned other retailers’ inventory overhangs into buying opportunities to get its customer base great deals as peers try liquidate their excess product.
But regardless of how retailers’ managed their inventory, most had to compete in a playing field filled with product others were trying to jettison, often at steep discounts. A chorus of executives described a highly “promotional” season full of marked-down prices and eroded margins.
Here’s a look at how some major players navigated the topsy-turvy year and its holiday season: