Note 6 - Inventories

12 Months Ended

Nov. 28, 2020

Notes to Financial Statements

Inventory Disclosure [Text Block]

6. Inventories

Inventories consist of the following:

	November 28, 2020			November 30, 2019
Wholesale finished goods	$	25,001		$	27,792
Work in process		516			733
Raw materials and supplies		14,836			17,293
Retail merchandise		27,946			31,534
Total inventories on first-in, first-out method		68,299			77,352
LIFO adjustment		(8,891	)		(8,688	)
Reserve for excess and obsolete inventory		(4,522	)		(2,362	)
	$	54,886		$	66,302

We source a significant amount of our wholesale product from other countries. During 2020, 2019 and 2018, purchases from our two largest vendors located in Vietnam and China were $15,378, $15,221 and $24,073 respectively.

We estimate an inventory reserve for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand, market conditions and the respective valuations at LIFO. The need for these reserves is primarily driven by the normal product life cycle. As products mature and sales volumes decline, we rationalize our product offerings to respond to consumer tastes and keep our product lines fresh. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required. In determining reserves, we calculate separate reserves on our wholesale and retail inventories. Our wholesale inventories tend to carry the majority of the reserves for excess quantities and obsolete inventory due to the nature of our distribution model. These wholesale reserves primarily represent design and style obsolescence. Typically, product is not shipped to our retail warehouses until a consumer has ordered and paid a deposit for the product. We do not typically hold retail inventory for stock purposes. Consequently, floor sample inventory and inventory for delivery to customers account for the majority of our inventory at retail. Retail reserves are based on accessory and clearance floor sample inventory in our stores and any inventory that is not associated with a specific customer order in our retail warehouses.

Activity in the reserves for excess quantities and obsolete inventory by segment are as follows:

	Wholesale Segment			Retail Segment			Total
Balance at November 24, 2018	$	1,500		$	266		$	1,766
Additions charged to expense		1,881			373			2,254
Write-offs		(1,327	)		(331	)		(1,658	)
Balance at November 30, 2019		2,054			308			2,362
Additions charged to expense		3,745			1,177			4,922
Write-offs		(2,378	)		(384	)		(2,762	)
Balance at November 28, 2020	$	3,421		$	1,101		$	4,522