Bill Angrick: Well, in terms of the macro trends, one, you want to have robust growth in online sales — online retail. We think that’s a well-entrenched habits among consumers and we think that as a secular growth area in the economy. And that is the catalyst for our business, because the more that’s sold online, as I noted, the NRF data, the more that’s going to be returned, so over $150 billion of return system in the holiday season. So that’s a good thing. I think bargain hunting kind of environments are the good thing on the buyer side. So when we have a little bit of a ripple around recession, buyers are looking for deals. So they’re going to be looking to save money and our buyer base has been very active, as I noted on our metrics.
I think that’s a positive. In terms of the retailers themselves, I think retailers are kind of balancing wanting to have good deals and stock and we all got emails probably in October for holiday sales. So they pulled forward a lot of those Black Friday concepts earlier in the year. So they were holding some inventory maybe that they would have otherwise liquidated. But I think as you get out of the holiday season, you’re going to see normalization of flows into our reverse supply chain, and I think retailers are going to be looking to be continuing to invest in omnichannel experiences, continuing to invest in convenience through their core e-commerce platforms. I think the consumer — the Bank of America data that came out says that consumers still have more savings than they had pre-pandemic.
So it seems like the consumer is holding up. I think that’s net positive for the retail environment. And ultimately, we think that’s helpful for us, the more spending on goods, the better we — we have commented, George, how during the course of 2022 people have shifted their behavior from buying goods to buying services and experiences. So that affected retail at large in some of their same-store sales activity. And I commented earlier in the year that we feel like that’s going to reverse and people will normalize their spending behavior in 2023.So I don’t have the crystal ball, are we going to have a soft landing as the Fed tightens or something that’s a little harsher. We would like to see more of a soft landing. We’d like to see the consumer continue to have discretionary savings and continue to normalize to where they were in early 2022.
But even in the recession environment, our bargain frugal buyer base is a very strong competitive advantage. And I think if retailers have to cut costs and hollow out their corporate resources, they’ll be more reliant on value-added services and facilities that Liquidity Services offer. So we think we’re well positioned there.
George Sutton: Looking at the vehicles supply side, in a very hypothetical admittedly scenario of Carvana, which could end up liquidating, not making a prediction just it’s a scenario suggestion, what would that potentially do for your business?
Bill Angrick: Specifically in the vehicle category?
George Sutton: Correct. If there is a whole lot of additional vehicles all of a sudden on the market from a supply perspective, what would that do for you?
Bill Angrick: Well, we — yeah, well, I can tell you that we’ve had conversations with wholesale automotive dealers who are looking, in many cases, for the first time to utilize our marketplace platform and create a new channel for Liquidity. If vehicles are sitting unsold, that’s not a good thing for these automotive wholesale dealerships. So we present our marketplaces another avenue for that asset class to be monetized, and we sell, as you know, a lot of vehicles in the used market and that Liquidity is an asset for anyone looking to manage their balance sheet in the vehicle industry.
