The Hidden Gem in Stitch Fix's Earnings Report
Nearly half of U.S. apparel spending is expected to shift online by 2025, according to research from Euromonitor International. Stitch Fix (NASDAQ: SFIX) is already seeing demand pick up with the number of first-time clients migrating to the platform at multiyear highs. To capture this tremendous growth opportunity, management is ramping up investment in inventory to keep up with the anticipated demand.
One hidden gem in the recent earnings report was management's discussion of moving to a vendor-managed inventory model, which is used by some of the largest retail companies to operate their world-class supply chains. This could be an early indicator that Stitch Fix is about to see a significant acceleration in growth over the next few years.
Here's how this new inventory model could help Stitch Fix capture more market share and firm up its profitability.
Source Fool.com
