Fashion could face ‘inventory recession’

NEW YORK – The fashion sector could face an ‘inventory’ recession as retailers pull orders forward over concerns about shipping delays and soaring cargo costs. With many fashion retailers ordering extra stock to cover themselves if some orders don’t arrive, consultants Ed Jernigan have also raised concerns that the fashion space could see a cancelled orders crisis similar to 2020.

“This pulling forward of demand is now becoming a concern for first half 2022 order books,” says Ed Jernigan. “What happens when all the double-ordered shipments placed in the panic begin to arrive with many having missed the intended season and sales deadlines? This raises fear that some in the supply chain may attempt to cancel or delay the latest orders as their inventories are rebuilt, which, of course, would cause significant problems for the textile and apparel supply chain. After the devastation of 2020 Covid, many would not be able to bear such an event.”