Stale inventory is a costly nuisance for any business owner. Ideally the rule of thumb is to sell the goods taking up space on your sale floor within 90 days. After three months, stale inventory becomes dead inventory and products are much harder to move.
Fortunately there are a number of ways to recoup at least part of your investment on old, slow-moving stock. Get rid of your old inventory with these six tried and true ideas:
Liquidate old inventory
For some business owners, this is their main tactic. Slash prices to make a sale and get stock off the floor. It’s more strategic though to discount items gradually, starting with a smaller price cut then moving to a higher discount if needed. Keep in mind that customers respond to a sense of urgency, which is why flash sales are so effective – offering something for a limited time. You’ll want to give just enough notice to reach as many customers as possible in a short time f and build excitement around the sale while encouraging buyers to act fast before they miss their chance.
Bundle items together
This marketing technique is based on the idea of grouping a few products together to sell for a lower price than it would cost to buy each item individually. The perception of added value can be irresistible to some customers. If you decide to group complementary items in a bundle (ie a variety of bath products), it makes sense to combine trendy products and hot sellers with items that aren’t moving well on their own.
Refresh your marketing
Sometimes it all comes down to positioning. Move your old stock to a more visible area. Rearrange your display to draw more attention. You may be surprised how the right approach can quickly turn your sales around on what you thought was hopelessly stale inventory.
Sell via an online marketplace
Some merchants choose to open a virtual store specifically to move items that aren’t selling in their actual shop. It’s easy to get started by selling on Amazon or eBay. For unique items, Craigslist offers a simple, low-cost way to make a bit of money back on old inventory.
Return excess goods
Consider contacting your vendor to see if you can negotiate a return on your old stock. You might have to pay a restocking fee, but at least you’ll be able to cut some of your losses. Your odds of convincing a vendor to return old products are better, of course, if everything is in its original packaging. Try explaining the reason the inventory was a mistake such as you ordered too much stock or the item was the wrong fit for your customers. If your vendor is keen to keep you as a customer, a firm but friendly approach may yield positive results.
Take a tax deduction
Donating old inventory is another way to make the most of slow-moving stock. Some non-profit organisations will offer a tax receipt so you can write off your donation as a deduction. Many will accept large shipments that would otherwise be difficult to offload. You may also be allowed to write off freight expenses when you ship a donation to an organisation.
Going forward, take proactive steps to avoid accumulating excess inventory. Investing in an efficient inventory management system is a great way to lower your operating costs and help you eliminate costly overstock. Check with us if you are uncertain.