Holiday shopping: Canadians can expect sales ‘very early’ this year. Here’s why

Retailers caught with overstocked inventories will be offering steep discounts to offload products as consumer spending starts to soften, experts tell Global News.

Overstocked inventories and fears of a recession on the horizon will push retailers to offload products at potentially steep discounts ahead of the holiday shopping season, according to experts.

Retail giants the likes of Walmart, Best Buy and Target have said in recent months that they’re sitting on excess inventories heading into fall.

Walmart, for example, said in August that it had to take steep price cuts on apparel to try to reduce more than US$61-billion worth of inventory at the end of the first quarter.

The messaging is a major departure from this time last year, when many retailers were warning that supply chain issues would lead to higher prices, major delays or products missing from store shelves.

Retail analyst and author Bruce Winder tells Global News that “inventory is one of the big issues right now in retail, almost across the board.”

“A lot of retailers are heavy right now with a lot more inventory than last year and than normal,” he says.

Winder points to the uncertainty in supply chains as driving much of the glut. Many businesses had to order early to ensure they had product on time, and to get out ahead of inflationary pressures driving up purchase prices.

Now, as supply chain issues are showing signs of improvement, some retailers have been “caught with a bit too much on order,” Winder says.