Taming the bull
in the bullwhip effect
Hardline retailers grapple with widespread inventory glut .
By Anshul Popli and Vikram Murthi
When the pandemic hit in March 2020 , demand for home improvement items , tools , furniture and electronics spiked . Employees that could work remotely invested in new furniture , computers , monitors , and electronics to set up their home offices , and bought toys and computer games to keep their children occupied as schools were closing . Consumers moved to purchasing online and pushed hardline retailers to scramble and offer home delivery and click-and-collect options .
The intensity of the demand surge
created severe shortages in various hardline categories such as appliances and home furnishing . To restock their depleted inventory , hardline retailers had been ordering products for their customers . However , the longer lead time during the pandemic coupled with the logistics disruptions prevented items from hitting the shelves . As the inventory started arriving , consumer preferences had shifted with businesses , entertainment venues and travel opening up .
This phenomenon led to a glut of inventory , forcing retailers to discount items such as seasonal products , electronics , and televisions .
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