As holiday merchandise gets held up, discount retailers get ready

Caroline Champlin | Sep 24, 2021

That record-breaking container ship backlog at U.S. ports is slowing everything down just in time for the holidays. For many in the consumer goods business, it’s a nightmare. For others, it looks like a big opportunity.

Think about a tinsel Christmas tree that might be sitting on a shipping container right now.

“Hopefully, that Christmas tree makes its way in a timely manner through the retailer supply chain and is on a store shelf in time for the holidays,” said Jeff Rechtzigel, a general manager at Liquidity Services.

This year, however, with ships waiting more than a week on the water and warehouse space at capacity, “sometimes, that Christmas tree may get to the store too late,” said Rechtzigel, who helps send those extra trees to discount stores, even in January.

“Sometimes, those retailers or small businesses will hold on to that inventory all the way until next Christmas season and then sell it for a higher price,” he explained.

If stores get too much holiday inventory, extras might also head to Curtis Greve, vice president of liquidation for Inmar Intelligence. “It’s gonna start flowing to me, probably, in the second week of December,” Greve said.

He plans to sell that stuff to discount stores that don’t have enough merchandise. His buyers are already emailing him. “Demand for toys, in any kind of those Christmas gift categories — those are off the charts,” he said.

Another bonus for these buyers is the popularity of online shopping, which has an average return rate of 30%, said Howard Rosenberg, CEO of B-Stock Solutions.

“After all the holiday sales happen, and the returns come at the end of December, beginning of January, that’s kind of our Christmas, right?” Rosenberg said.

The more gifts sent back, the more business for him.

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