How rising ocean freight costs lead to dead stock, and how to avoid it

You paid the factory in full. The order spent five weeks on a boat, another week or two getting received at a US warehouse, and landed after demand had moved on. Now half of it sits on a shelf and costs you storage every month. Meanwhile, your best seller sold out in week two.

More brands are stuck in that spot. In Netstock's 2026 Supply Chain Planning Benchmark Report, 24% of businesses surveyed said more than 10% of their inventory was dead stock, up from 12% in 2024. Ocean freight is adding to the pressure. In 2026, the spot rate for a 40-foot container from Shanghai to New York more than doubled in about four months, which pushes brands toward even bigger, earlier orders.

Rising ocean freight pushes you into bigger orders

On Drewry's World Container Index, a 40-foot container from Shanghai to New York cost $4,317 on May 21, 2026 and $10,394 on September 17, 2026. Shanghai to Los Angeles reached $7,712 the same week. Our breakdown of what drives container shipping costs covers why rates swing this much.

Whether you book a full container or share one, those rates set the price of every freight quote for US-bound goods. When freight costs more, the pressure is to ship fewer, bigger orders to spread the cost, and every extra unit is another bet on your forecast.

Long lead times turn those orders into dead stock

Long lead times force you to order big and order early, and every order placed months ahead is a bet on demand. Netstock's research on small and medium-sized businesses shows how common this is.

• Nearly three quarters call lead time variability a planning challenge.
• 63% point to long lead times.
• 60% identify minimum order quantities (MOQs) as ongoing obstacles.

The pressure is highest for brands that make their products in China. In Netstock's survey, 75% of businesses sourcing from China cited long lead times, compared with 42% of those sourcing elsewhere.

Here's how that turns into dead stock. You forecast three or four months out. The factory's MOQ pushes your order above that forecast. Demand shifts before the container lands, and the extra units have nowhere to go.

The legacy model locks cash into stock you can't sell yet

In the legacy 3PL model, your money leaves months before it comes back. Craft Club co-founder Nikos Maniaty described it plainly:

It takes two or three weeks for a manufacturer to produce the product and then it takes another five weeks on a boat to get here. So effectively, you've got capital tied up on a boat doing nothing. — Nikos Maniaty, Co-founder at Craft Club

The boat is only one leg. Ocean freight takes 30 to 45 days on the water, plus customs and receiving. Duty is due when the container clears customs, before a single unit has sold. Then holding costs start at the warehouse.

::table

Step;Legacy ocean freight and US warehouse;Direct fulfillment with Portless

Where stock sits;On a ship, then in one or more US warehouses;In one fulfillment center close to the point of manufacture

How long until stock can ship;30 to 45 days on the water, plus customs and receiving;Inbounded within one business day of arriving at the hub

When duty is paid;On the whole container, at import;At the point of sale, order by order

How you reorder;Commit 90 days out per region, based on forecasts;Against live sales data

Cash conversion cycle;About 90 days with a legacy 3PL;About six weeks for most brands

:table

How direct fulfillment cuts dead stock at the source

Direct fulfillment keeps your stock close to the point of manufacture and ships each order straight to your customer. Portless ships from its own fulfillment center in China to 85+ countries, with average global delivery in five to eight days.

Your stock is ready to ship in days

Portless inbounds stock within one business day of it arriving at the hub. You skip the ocean leg, the port, and the US warehouse intake, so you forecast weeks ahead instead of months. Moving to Portless let reusable bottle brand memobottle bring its product launches forward by more than 100 days.

Ocean rates stop setting your order size

Orders ship by air from the fulfillment center to your customer's country, where a local carrier delivers the final mile through direct injection. You never need to fill a container, so a spike in ocean rates doesn't push you into a bigger order.

Air freight costs more per kilogram than sea freight. The gap narrows once you count what ocean freight adds, like weeks of carrying costs, duty paid upfront on the whole shipment, and stockouts while the next container is at sea. Our comparison of air freight vs sea freight runs the numbers. memobottle's figures show the trade-off. When it moved to Portless, it budgeted for a 10–20% increase in shipping costs to customers, and the increase during its test came in closer to 10%. It also expects to cut most of the $25–30K a month it spent on storage during peak periods.

Your reorders follow real sales

With a legacy 3PL, you commit stock 90 days out for each region. With Portless, you reorder against live sales data. Smaller, more frequent orders track demand closely, so less stock is left over when a product slows down.

Fast reorders also keep best sellers in stock. Ahead of Father's Day, menswear brand &Collar rerouted about 40,000 units through Portless within 30 days. Co-founder Mark Brown said that without it, &Collar would have been only 5% in stock on its hero SKUs. Its Father's Day sale revenue grew 35% year over year.

Craft Club saw the same thing. Co-founder Nikos Maniaty put the change this way:

We used to be out of stock all the time. Now, we're never out of stock because the speed at which we can order, the speed at which we can sell, the speed at which we can scale, it's all just so much greater. — Nikos Maniaty, Co-founder at Craft Club

One inventory pool serves every market

Portless serves 85+ countries from one inventory pool. You don't split stock across regional warehouses, so one region can't sell out while another sits on extra units.

New markets run from the same pool, so a product that slows in the US can sell in the UK or Australia. In practice, one pool means fewer warehouses and faster launches in new markets. memobottle is consolidating six regional 3PLs into one Portless hub, and it projects the move will cut its inventory holding by roughly 5x. Privacy Clo started selling in 17 new countries within months, with Portless handling compliance, duties, and documentation for each market.

You pay duty as orders ship

With direct fulfillment, the duty event happens at the point of sale, after the customer has already paid you. You don't pay duty on a full container of stock that may never sell.

Your cash turns over faster

Craft Club's cash conversion cycle ran past 22 weeks under the legacy model, so its cash turned over about twice a year. With Portless, the cycle dropped to six weeks, which turns cash over more than eight times a year, and revenue grew 3x. Every dollar that isn't sitting in dead stock goes back into products that sell.

See how Portless works

Every order you place months ahead is a bet on demand. Talk to our team to see what your cash cycle would look like with Portless.

FAQ

What is dead stock?

Dead stock is inventory that hasn't sold and isn't expected to sell at full price. It ties up cash, takes up paid warehouse space, and usually ends up discounted or written off.

How do brands clear dead stock they already have?

Most brands discount it. In Netstock's survey, 77% used promotions or sales to move excess inventory, 39% used liquidation, and 34% moved stock to another location. Each of these trades margin for cash.

Does direct fulfillment change factory MOQs?

No, your factory sets its own MOQs. Direct fulfillment changes what happens after you meet them. Your stock is inbounded within a business day, you can sell it in 85+ countries, and you reorder against live sales, so an MOQ is less likely to leave you with units you can't move.