01
Low-Value Density = High Warehousing and Fulfillment Costs Relative to Merchandise ValueAn item's dollar value relative to its weight and space occupied determines its value density. Low value density big & bulky have an increased need for cost efficient storage and fulfillment solutions.
02
Non-Standardized Products = Complex Inventory ManagementProducts come in various sizes, colors, and styles, creating a long-tail effect and wide range of niche Items. The unpredictability of demand can lead to challenges in inventory management that result in over- or under-stocking.
03
Fragmented Industry = More CompetitionThe large number of resellers creates intense price competition, which can squeeze profit margins and make it challenging for retailers to remain profitable.