Fresno Ag

The stockroom at Fresno Ag Hardware has been a lesson in unpredictability as some items fly off the shelves and others are overstocked for a variety of reasons. Photo by Ben Hensley

published on August 22, 2022 - 1:22 PM
Written by Ben Hensley

Economic experts have been warning of recession since the beginning of the year. These warnings — paired with inflation, especially higher gas prices — have led many Americans to be much more cautious with their finances.

The inconsistency of the economy, however, has led to a variety of results for different businesses, with some seeing booming sales and others struggling to find shelf space and handle the ever-changing shipping environment.

Karen Chisum owns The Foundry, a boutique store in Clovis specializing in women’s clothing, home decor and infant and baby clothing items.

She says that shipping has been challenging to keep up with, causing both overstock and out-of-stock problems.

“It’s definitely been a continuation of COVID with regards to inventory and production,” she said. “Last year was really rough on inventory, just getting it on time.”

Many seasonal clothing items, for example, were being, and in some cases continue to be, shipped late. Summer clothing being delivered in the fall, for example.

Another issue facing the store has been price increases on shipping.

“We order at one cost, and then we get a notification before it ships that they’re going to have to tack on an ocean surcharge because all the cost of freight has gone up more than they anticipated,” she said.

Chisum added that the store does its best to work with their wholesalers, understanding that much of the inventory problems are out of their control.

Chain store Plato’s Closet, which both buys and sells secondhand clothing items, has seen the distribution chain’s inconsistency at a direct consumer level, given their unique business model in which much of their inventory is sourced directly from customers.

“Right now we have a really big influx and everything is in high demand,” said Serenity Venegas, assistant manager of Plato’s Closet in Fresno. “We have been prioritizing what we should take based off season.”

The store provides interesting insight because, in their case, the customer is their primary distributor.

Despite the challenge of inventory management, and being forced to rent out an additional storage container, Plato’s Closet has seen its Fresno location thrive, with sales up over 300%, going from an average gross daily sale of $2,000 during pre-pandemic levels all the way up to $9,000 per day at their peak this year.

Stocking challenges, however, did force the Plato’s Closet location in Bakersfield to close during the pandemic, citing an increased intake of customers selling items with less customers buying.

Fresno Ag Hardware has felt a unique impact from the economic instability, with some items flying off the shelves while others are delivered late, and others still being overstocked and unable to be offloaded due to several reasons.

They, however, experienced a unique situation, seeing sales increase during the pandemic, despite going from seeing two fully loaded delivery trucks per week to one truck, often only filled to 60% capacity.

“We’re a fairly busy store even prior to the pandemic, but during the pandemic, starting in March of 2020, we were seeing upwards of 1,400 transactions a day,” said Ian Williams, chief operating officer of Fresno Ag Hardware.

Following the pandemic, the store saw some distribution issues, but only among certain items, in particular, patio furniture.

“We received pretty much everything in May,” Williams said. “We didn’t get any product in February, March or April, and then when May came around, it all just showed up at once.”

They know that at some point supply chains would eventually pick back up to more consistent levels, and Williams credits his team with working efficiently with their suppliers and their ability to keep inventory manageable.

“The biggest thing was materials,” he said, citing the largest obstacle to their company specifically being price increases. “Even when you’re buying in bulk or at a trade show; even if you’re catching a 15% discount on buying that bulk, you’re basically paying what you would have been paying out of the warehouse.”

The economic instability coming out of a pandemic, coupled with the fluctuating cost of oil around the globe, have forced these retailers, and many like them, to alter their business practices when it comes to distribution and receiving products.

As the economy continues to fluctuate worldwide, retailers and customers alike should be prepared for more changes in the future, despite things beginning to return to pre-pandemic normalcy.

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