Overstock Volumes Surge 20% in May as Tariff Avoidance Backfires
COST•Costco and other retailers stockpiled inventory to preempt higher tariffs, triggering a reversal in returned-to-overstock ratios to 50/50 and driving a 2 million unit monthly increase from March to May versus 2025. Inflation-suppressed consumer spending left warehouses maxed out and overstock volumes up 20% in May.
1. Tariff Avoidance Drives Inventory Build-Up
Data from B-Stock show that Costco and other major retailers amplified import orders to sidestep potential tariff hikes, flipping the usual 75/25 returned-to-overstock ratio to roughly 50/50.
2. Inflation Suppresses Demand and Fills Warehouses
Persistent inflation has curtailed consumer spending across consumer goods and apparel, leading to unusually high warehouse utilization and mounting levels of excess stock.
3. Massive Year-on-Year Overstock Growth
Between March and May, monthly overstock volumes rose by approximately 2 million units compared with the same period in 2025, while May alone saw a 20% year-over-year surge.
4. Resale Channels Emerge as Strategic Outlet
The inventory glut underscores the opportunity for resale platforms to serve as strategic channels for retailers like Costco to recover value and manage cyclical inventory imbalances.
