Posted on October 25th, 2022.
Quick Take: This blog shows ways to deal with overstocking.
What you will learn:
Excess inventory not only constrains valuable back room and shelf space, but can also constrain capital and discourage reinvesting in business or buying what you really need. Therefore, it is very important to pay attention to sales and inventory data on a regular basis. You need to keep an eye on product development so you can make the right buying and advertising decisions. At the same time, by getting an overview of the number of items in stock, you can understand the products and prevent overstocking in the store. Still, overstocking issues can occur due to out of control. The trend may have changed suddenly or the forecast may not be as expected. Either way, don't worry. If you see a surplus item in your store, there are some steps you can take to settle it:
1. Revive, re-merchandise, or re-advertise
When an item isn’t selling, the problem may not necessarily be the product itself. In some cases, the issue may lie in how you’re marketing or positioning the merchandise. Try to refresh your marketing and merchandising efforts when it comes to your slow-moving or old inventory.
2. Give more exposure to your passive-movers to sell old stock
If you're dealing with slow-moving inventory, it's a good idea to double or triple expose your items. This means that these items are in more places in the store. For example, you can display them on the front of the store and then place the same items on the back. You can also identify opportunities for cross-merchandising. If a particular product is slow, it may be helpful to refer it with a matching or complementary product. If these merchandising tactics don't work, you may need to lower the price. This leads to our next point ...
3. Give discount on these Items (but strategically)
If remarketing or remerchandising doesn’t work, consider lowering prices for of excess stock. Retailers are advised to discount prices at certain increments. Start off with something small, say 30% and then continue to discount.
4. Bundle items
Bundles are another standard practice for traders. This is the second most popular pricing method for retailers in all industries (after discounts). If it makes sense for your business, consider grouping specific products and selling them at slightly lower prices than if you were buying them individually. This allows you to move goods without significantly damaging your profits.
5. Offer them as freebies or incentives
This tactic is great for low cost items. If it is difficult to sell the item, use it as a free gift or incentive instead. For example, you can offer it as a "bribery" to subscribe to a mailing list or increase the value of your cart (for example, "Use over $ 75 to get a free bag").
Contact us with any questions about our liquidation products and services.