The State of the Retail Market – During and Post-COVID-19

In today’s reality, markets have shifted and new trends are emerging. Consumers are focusing on needs versus wants; some products are in high demand, while others are headed for a world of surplus. As logistics and labor operations continue to shift, let’s take a look at what we’re seeing now based on data and insights from our B2B marketplaces and what we expect for retail and the secondary market once stores reopen. We’ve broken it down into three stages.

Stage 1: System shutdown + uncertainty of when it will end

Stay-at-home orders are in effect and  non-essential stores are closing (or for those businesses that are open, non-essential products aren’t moving). On the other side of things, online/pickup orders of essential products are spiking. These trends have trickled down to the secondary market.  Across our network of retailer marketplaces, we’ve seen: 

• A substantial increase in demand for certain product categories including grocery, toys, educational items, and large appliances (freezers) 
• Certain retailers that sell non-essential goods, have are paused their marketplaces altogether
• Some are moving b-stock back to a-stock to accommodate demand in the primary market
• Others are finding their traditional secondary market outlets are limited, so they are shifting more product to B-Stock.

Stage 2: Back to school, work, stores reopen 

As business—on all fronts—goes back to normal, so too will purchasing patterns. Though demand won’t decrease, the market will have to flush out all of the backed-up product. The current stock up of essentials will lead to excess inventory in that arena – both from manufacturers and retailers that were closed during the pandemic – and retailers that remained open but weren’t moving non-essential products like clothing and home goods.  

For retailers, the reopening their stores will mean two things: 1) The implementation of extended returns policies will result in a spike in returns and 2) They will be faced with excess inventory left over due to store closures. Combined, these factors will mean that traditional disposition channels – like outlet stores, discounters, and big liquidators –  will not be able to accommodate the increased inventory levels.

Stage 3: Back to steady state and a new normal

At this point, rather than holding onto the merchandise, businesses with excess inventory should start leveraging a B2B sales channel to sell directly into the secondary market. A B2B recommerce solution in the form of a private online auction marketplace enables the retailer to sell directly to thousands of business buyers; which will allow them to offset more loss and move inventory faster. 

B-Stock’s auction marketplaces are customized and scaled based on each retailer’s needs and goals. That’s why nine out of the top 10 U.S. retailers are leveraging our platform to drive demand and achieve higher pricing, as well as a faster sales cycle—all while maintaining brand integrity. 

In the aftermath of COVID-19, a new normal may emerge, producing a bigger secondary market than there was prior. If you want to harness the value of the secondary market for your excess inventory—schedule a demo today.