April 16, 2025 • Spotlight
As tariffs continue to rock consumer spending projections, warehouses reap the benefits of changing inventory management.
March saw an uptick in inventory purchasing as manufacturers and shippers tried to beat the tariffs. With a 90-day pause on some tariffs, this stockpiling may continue. As inventory accumulates, there will be a huge need for warehousing services to manage it.
Most manufacturers and shippers operate on a Just-In-Time (JIT) inventory management model. This means products and materials are received when you need them. However, with the current tariff pause, many are shifting to a Just-In-Case (JIC) model. This means having excess inventory.
Once the pause is up there will be many suppliers in need of storing this excess inventory. This is where warehousing needs are going to soar. We’re already seeing an increase in demand for storage space across the country. Suppliers are preparing to store inventory for the foreseeable future as Trump’s policies vacillate.
Until we see more predictability, consumer confidence is going to waffle. Not all is pessimistic, though, as retail spending continues despite the current volatility. Suppliers and warehouses may both share in the benefit of inventory flooding. As long demanded products and materials remain stateside, consumers will be willing to spend. Let’s see where the remainder of this tariff pause takes us.
Even with the 90-day pause to these tariffs, we anticipated this shift in inventory management in our Q2 Expectations post. At FSL, we pride ourselves on our agility and knowledge-base. Partner with us today, so we can help plan for these necessary shifts. Let us do the work!
