All-Steel Tire Distributor Inventory to Continue Rising in Nov After Increase in Oct
Introduction: In October, there were fewer days for sales due to the holiday. Moreover, the weather got colder, resulting in decreases in tire wear and tear, further dragging down the sales at distributors. However, some brands announced price increases in October, stimulating the tire goods transfer to the market, triggering a rise in the inventory at distributors.
In October, the distributor's inventory continued to increase.
During the National Day holiday in early October, some logistics and transportation services were on holiday, which affected the terminal market demand. At the same time, the number of saleable days this month has decreased to some extent, affecting the tire sales. In addition, as the weather turned colder in October, the tire wear and tear decreased, which slowed down the inventory consumption of distributors. In October, some brands issued price increase notices, but more of them were bundled sales strategies aimed at achieving sales volume. To a certain extent, this stimulated distributors to build more inventory. Thus, the inventory at distributors continued to edge up.
Distributors’ inventory survey
In terms of the changes in distributors’ inventory in October, SCI conducted a survey of market distributors.
SCI conducted a survey of 62 all-steel tire distributors in China. Among them, distributors in East China accounted for the largest proportion, making up 45% of the total. Those in North China ranked second, accounting for 22%. Central China ranked third, accounting for 15%, and other regions accounted for 18%. The distributors surveyed by SCI included those of leading enterprises like Zhongce Rubber, brand distributors of enterprises in Dongying and its surrounding areas with a monthly sales volume of over 200,000 pieces, brand distributors from non-Dongying enterprises with a monthly sales volume of over 200,000, brand distributors of enterprises in Dongying and its surrounding areas with a monthly sales volume of less than 200,000 pieces, and brand distributors from non-Dongying and its surrounding areas with a monthly sales volume of less than 200,000 pieces.
Survey result:
In October, the inventory of most distributors trended up, that of a few distributors remained stable, and that of a few distributors declined slightly.
In October, logistics transportation services took holidays. At the same time, the number of saleable days this month decreased, affecting the sales volume of distributors. Moreover, the weather turned colder this month, reducing terminal tire wear and tear and dragging down distributors’ sales. The overall sales of distributors in October were lower MoM, and the inventory consumption was slow. In addition, some brands issued price increase notices, which to a certain extent stimulated the transmission of tires to the market, and the inventory of most distributors showed an upward trend. However, the inventory levels of some distributors reached a high level, and they deliberately controlled their inventory. Coupled with the stimulus of price increases, the overall sales were acceptable. Thus, their inventory was stable MoM, and even the inventory of a few distributors decreased somewhat.
The distributors’ inventory is predicted to continue rising in November.
SCI reckons that distributors’ all-steel tire inventory is expected to continue to edge up in November. In November, as the weather turns colder, the operating rate of outdoor work in some areas may further decline. Coupled with the reduction in tire wear, the inventory consumption of distributors is likely to underperform. However, under the pressure of purchasing tasks, distributors may still have a certain amount of inventory replenishment. Therefore, it is expected that the inventory may continue to rise.
All information provided by SCI is for reference only, which shall not be reproduced without permission.
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