Retailers managing inventories
A one-week strike at the Ports of Los Angeles and Long Beach ended last week, bringing a sigh of relief to retailers in the thick of replenishing goods for the holiday shopping season. News reports had indicated the work stoppage had some retailers worried about their ability to replenish hot-selling items. Meanwhile, current Sageworks data shows that in recent years, retailers have lowered their inventory levels as a percentage of their total assets.
Retailers’ average inventory-to-assets ratio has declined to 43.85 percent so far this year from 45.63 percent in 2007, according to preliminary analysis of current data for the industry. Inventory as a percentage of assets for 2012 year to date is close to the level for all of 2011, when it was 44.26 percent.
See a chart with Sageworks data showing retailers’ inventory trends and additional information here.