Stale inventory can be a costly nuisance for any business owner. The general rule of thumb is to sell the stock taking up space on your sale floor within 90 days. After the 90 day, mark stale stock becomes dead stock. Products become much harder to move and almost impossible to get top dollar for it.
Thankfully there are several ways to recoup at least some of your investment on the slow-moving stock. Get rid of your old inventory with these six tried and tested ideas.
Liquidate old inventory
For some business owners slashing prices to make a sale and get stock off the floor is their go-to method. It’s more effective though, to discount items slowly starting with a minor price cut – then moving to a higher discount when needed. Keep in mind that customers respond better to a sense of urgency, which is why flash sales are so effective (i.e., limited-time offers). You want to give just enough notice to reach as many customers as possible in a short time frame and build excitement around the sale while encouraging buyers to act quickly before they miss out.
Bundle items together
This marketing technique is based on the idea of putting a few products together to usually sell for a lower price than it would cost for the customer to buy each item separately. The perception of added value is irresistible to some people. Suppose you decide to group similar complimentary items in a bundle (i.e., a variety of hair products). In that case, it makes sense to combine trendy products or hot sellers with items that aren’t moving well on their own.
Refresh your marketing
Sometimes it all comes down to where stock is placed in your store. Rearranging your display or moving inventory to a more visible area can quickly turn sales around on what you thought was a lost cause.
Sell via an online marketplace
Some operators choose to open online stores specifically to move items that aren’t selling in their brick-and-mortar shop. It’s easy to get started selling on eBay. For those one-off items, a Marketplace listing also offers a simple, low-cost way to make a bit of money back on old inventory.
Return excess goods
Consider contacting your supplier to see if you can negotiate a return on your stock. You will probably have to pay a restocking fee, but at least your loss won’t be as costly. Your odds of convincing a supplier to return old products are better, of course, if everything is still in its original packaging. Try explaining why the inventory was a mistake (i.e., you ordered too much stock, the item was the wrong fit for your store). If your supplier is keen to keep you on a customer, a firm but friendly approach may yield positive results.
Take a tax deduction
Donating old inventory can be another way to shift 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 bulk shipments that would otherwise be tough to get rid of. Be sure to talk to your accountant about other write-offs for your business. For instance, you may be allowed to write off freight costs when you ship a large donation to an organisation.
In the future, try to take proactive steps to avoid accumulating excess inventory. While Investing in an efficient inventory management system can have an initially costly fee. It can be a great way to lower your operating costs and help you eliminate what could be a disastrous overstock.
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