Wholesale Inventories Down, Sales Up
October 10, 2001
The latest word is that wholesale inventories are down for the third consecutive month, and that could be good for trucking.
Wednesday, the U.S. Commerce Department reported wholesale inventories fell 0.1% in August, following a 0.9% drop in July.
Also wholesale sales increased 0.6% following a 0.9% increase in July. The stock to sales ratio, which measures how long it would take to deplete current inventories, fell for another month in August, to 1.30 months, down from 1.31 months in July. Inventories of durable goods fell 0.7% in August, following a 1% decline in July, while inventories of non-durable items increased 0.9% after falling by a similar amount the month before.
The news of increased sales and declining inventories could result in an increase in business for the nation’s trucking companies. That’s because companies have been working off excess inventories to bring them back in line with demand. But this also depends on consumer spending, and its future looks bleak.
Following the Sept. 11 attacks on the United States, consumer confidence has taken a nose dive and if the public decides to close up their wallets, that could cause inventories to move back up, resulting in less manufacturing and fewer goods needed to be moved by truck.