This study empirically investigates the structural mechanisms driving the deepening issues of inventory in the Japanese textile and apparel industry. As industry faces increasing pressure to address environmental waste and improve profitability, understanding the statistical reality of inventory behavior is essential. The primary objective of this research is to identify how the relationship between inventory holdings, sales, and asset structures has evolved over time, distinguishing between intentional efficiency strategies and unintended accumulation. The research methodology employs a cross-sectional regression analysis applied to financial data of Japanese textile and apparel firms over the past three decades. Adapting an inventory model to capture year-by-year structural changes, we estimated the coefficients for baseline fixed inventory (intercept) and the sensitivity of inventory to current sales and sales changes. The long-term results reveal a paradoxical structural shift. While the baseline fixed inventory level has historically trended downward, suggesting apparent efforts toward leaner operations ("asset compression"), the sensitivity of inventory to sales has consistently increased. This indicates that generating a unit of sales now requires a higher marginal level of inventory than in the past, likely due to elongated lead times from offshoring and increased product variety. Crucially, the analysis of the COVID-19 period highlights severe supply chain rigidities. Specifically, in 2021, the coefficient for sales change turned significantly negative. This provides statistical evidence of "stickiness," where inventory levels failed to adjust downward proportionately to the sharp decline in sales, resulting in massive unintended accumulation. Furthermore, the post-pandemic data for 2023 shows a sharp rebound in baseline inventory levels, surpassing pre-pandemic figures. These findings imply that the current excess inventory problem is not merely cyclical but stems from deep-seated structural inefficiencies and a reactive shift in management strategy. Japanese firms appear to be moving from efficiency-oriented models to "just-in-case" buffer holding to mitigate supply chain disruptions. This structural transition suggests that without addressing the fundamental disconnect between lead times and demand forecasting, the industry’s inventory burden will continue to exacerbate both financial and environmental risks.

Keywords

inventory, textile and apparel industry, accounting information analysis.