Inflation, consumer demand drop wholesale challenges in 2024: Report

However, respondents are now witnessing challenges that were unseen in the years before: a lack of visibility with retailers, fewer pre-orders and a lack of streamlined tech. NuORDER sees a continued priority towards ensuring that retail partnerships stay healthy and grow.

Wholesale continues to be the most profitable investment channel for brands, accounting for an average of 60 per cent of total company sales.

This is especially true for enterprise brands that have a revenue of over $50 million a year and that project a greater investment in wholesale over direct-to-commerce (DTC) or e-commerce in the next year, the report said.

This has contributed to a notable business shift for brands, which are now relying heavily on automation for marketing outreach to acquire more retail partnerships and to sell deeper into existing accounts over more traditional methods, it noted.

Earlier, operational challenges like concerns around supply chain and inventory management were the main pain points most brands were trying to overcome.

However, brands have a single eye towards business expansion this year and are now looking for more ways to grow their wholesale businesses, the report noted.

Brands now say their greatest business challenges are finding new retailers and improving the buying experience for their existing retail partners to sell deeper into those accounts.

Businesses are reaching greater digital maturity and report having an established data and technology practice for optimising sales strategy and distribution.

NuORDER has seen a continual upward trend in wholesale’s expected growth as a channel year over year and this year is no different. Brands are reporting more optimism around the growth of their wholesale channels (up by 6 per cent from last year) and the anticipated growth of the channel is up five times more than in 2020.

In conjunction with this increased shift, NuORDER has seen that online retail growth is faltering, as online-only wholesale retailers have seen a decline in market share in the last year.

While half of brands will be prioritising investment in wholesale above all other channels, B2C e-commerce remains an important line of business for brands this year, likely to remain on par with consumer shopping behaviours. Investment in online wholesale retail, however, is on the decline.

Fibre2Fashion News Desk (DS)