How the Shaky World Economy Influences Wholesale Data

The sluggishness of the world economy has done few favors for the wholesale industry. Between countries on the continent struggling to absolve their debt crises and the perpetual specter of a double dip recession in America, it’s no wonder that the wholesale industry has been struggling all over the globe. So many consumers and businesses depend on wholesale goods for any number of reasons; food, construction supplies, raw materials, manufacturing goods—the list goes on. The volatility of today’s market has thrown regular inventory rates and prices into a veritable disarray, making it hard for wholesalers and buyers to come up with any solid long term business plan.

Let’s take a look at some of the current events that have influenced wholesale production, costs, and management over the past few months.

Fluctuating Inventory Stockpile

For one, the slowing and uncertain worldwide economy has had a great influence over the buying and stockpiling habits of many wholesalers. A recent article in The Washington Post explains that wholesalers had only slightly increased their stockpiles in recent months, the principal reason being the uncertain economic climate. Specifically, the article states that wholesale stockpiles in the US increased by only 0.3% in March, at a fraction of the rate a month before. The reason has all to do with the overall perception of the country’s economic growth: wholesalers purchased more stockpiles in the beginning of the years when employment numbers were higher and the economy looked as if it were well on the road to recovery.

But if there’s any takeaway from the current economic slump, it’s that nothing is certain. The recent months in the US economy have shown little sign of huge growth in areas of job growth, causing many wholesalers to hedge their bets and stock their inventories a little less.

Variable Wholesale Prices

Pricing amid wholesalers in various industries have fluctuated in the face of uncertain economic times. In the UK, The Financial Times reports higher wholesale prices in the energy industry which will translate to higher gas prices for consumers. The move, announced by UK energy giant Centrica, is part of a growing trend in higher gas prices in the country. And yet while the UK wholesale gas market is experiencing a price increase, many wholesalers across the pond are enjoying a general decrease in their prices. The publication USA Today reports that wholesale prices in the US have enjoyed a recent (if slight decline). The reason for the overall price decline is complex, but most analysts point to the gradual decrease in gas and energy prices in the US for at least the past month. With lower gas prices, wholesalers spend less on transporting and storing goods, which results in a better product price for consumers.

What’s your take on the current wholesale industry?

Clearly things could be worse for wholesalers, but the shaky economy is making any makeable growth and expansion difficult for most players in the industry. For those directly in the industry, what is your take on the prospects of wholesaling in the current economic era? Let me know in the comments!

This is a guest post by Eliza Morgan who is a full time blogger. She specializes in writing about business credit cards.