Inventories down but economy strong, according to Commerce Department
According to the Commerce Department Q3 economic activity slowed as companies worked off inventory that had built up in their warehouses. According to a Reuters article by Lucia Mutikani:
"Businesses accumulated $56.8 billion worth of inventory in the third quarter, the smallest since the first quarter of 2014 and down sharply from $113.5 billion in the April-June period.
The small inventory build sliced off 1.44 percentage points from third-quarter GDP growth, the largest since the fourth quarter of 2012."
The expectation is that activity will pick back up in Q4 because the underlying consumer demand in the economy continues to be strong. Consumer spending increased by 3.2% in the quarter, which was very strong.
The bottom line for secondary market buyers seems to be positive, on balance. The economy is strong, which implies we should see strong holiday spending. Expectations are for holiday consumer sales increasing around 6-9% over last year. This will ensure a robust flow of returns and unsold excess in January and February. So, position yourself now to have capital available after the new year so you will be able to buy some of the highly desirable inventory sure to be flooding the secondary market.
If your capital is tied up in inventory, consider liquidating it through one of the stronger channels out there, like BStockSupply.com. You will get reasonable value and begin to raise cash for buying products that will turn over more quickly and at higher margins.
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