Major U.S. retailers, such as Dollar General, Walmart and Macy’s, could be left with excess stock ahead of the holiday season for the second straight year based on an analysis conducted by the financial news and data platform LSEG Workspace.

According to Reuters, U.S. shoppers are only expected to increase their spending in 2023 by 3% to 4% year-over-year. Industry estimates predict that this would be the slowest pace of growth seen since 2018.

"I am relatively pessimistic about the holiday season," said Gerald Storch, a retail consultant, the former vice chairman of Target and the ex-CEO of Hudson's Bay. "It's possible that some retailers could be overly optimistic and make that mistake of buying too much yet again."

Excess inventory could drive up retailers’ expenses for handling, storing and transporting products predicts Jeff Bornino, the North American president of TMX Transform and a former supply chain executive at Kroger.

"The undeniable reality in retail is that 15% to 20% of products occupying store shelves need to go," Bornino added.

According to the Reuters analysis, two-thirds of the 30 retailers, including sporting goods company Foot Locker and beauty store Ulta Beauty, gave answers that indicated either slow sales or excess stock.

Meanwhile, major retailers like Walmart and Best Buy have begun offering holiday discounts earlier than usual to counteract some of the financial strain shoppers are expecting this season.

"And that is simply driven by the fear that the consumer, by the end of the year, could be in a weaker state," said Brian Mulberry, a client portfolio manager at Zacks Investment Management.