The good news is that excess inventory does not instantly result in a loss. There are still methods to gain from it. While it is better to just store a small amount of inventory, there are several reasons why organizations are faced with excess inventory.
Here are four practical ways for selling overstock products and perhaps recouping your investment.
1. Resell Your Items
When a product fails to sell, it may not necessarily be the product’s fault. Sometimes the issue is the way you position or market the goods. When it comes to slow or obsolete inventory, strive to revitalize your marketing and merchandising efforts.
Rethink your marketing strategy. There are actions you may do to improve the appearance of older objects. And you may use them whether you’re selling excess products online or in person.
Changes to your marketing plan, such as the advantages you stress, your target market, or the keywords you utilize, may result in increased sales. Take updated images of your products. Be imaginative with how models utilize it or show it off in different circumstances. You may also adjust the position of the product in your store or online to attract consumers’ attention rapidly.
If implementing these changes helps you get rid of your extra inventory, you might want to reconsider your marketing strategy. To build a fresh strategy, it is best to start from scratch.
2. Sales and Promotions
A sale is a tried-and-true approach for increasing customer demand and removing surplus inventory. Several retailers wisely include post-holiday sales into their marketing plans in order to get rid of seasonal leftovers.
Other retailers will hold “flash sales” in the interim. The customer is pleasantly surprised by these sales. It’s a fantastic approach to get rid of surplus inventory before it becomes obsolete or incurs hefty holding expenses.
Take notice that these sales have a huge consumer attraction. Distribute marketing materials like emails, mailings, retail signage, and other printed materials. Inform your consumers that you will be having a one-day only sale. Because of the urgency of the sales, customers will spend on reduced products.
If you have a large surplus of product, encourage customers to buy numerous pieces at a discount. The higher the discount, the more things purchased.
Bulk discounts may tempt clients to make greater purchases than they expected; this is an excellent tactic for selling excess goods.
3. Bundle Deals
Bundling is another popular pricing technique used by merchants. Bundling allows you to sell overstock inventory of many items for a lower price than if they were sold separately. This allows you to keep your margins and earnings while discounting products.
Another effective strategy for making things look more enticing is to combine slow-moving inventory with in-demand commodities. Customers looking to purchase a hot item will regard a bundle as a good deal and will most likely take advantage of it. Consider mixing high-margin and low-margin items as well. This allows you to offer a more appealing price for the package. This may be marketed as selling complementing things. Bundle socks that aren’t selling well with some of your best-selling shoes, for example.
It is not always necessary to integrate your excess inventory with comparable commodities. Sometimes all it takes to persuade someone to buy something is to point out a good price. Selling a slow-moving item at a lower price to paying consumers will increase your sales.
4. Freebies and giveaways
Giveaways of surplus items might persuade your consumers to buy more. Excess merchandise might be given away as a “thank you” for purchases. Freebies at the checkout can help shift out-of-date products and prevent cart abandonment.
This implies you will not receive your money back for the surplus products. However, you will increase client loyalty. Furthermore, openly promoting a “gift with every purchase” campaign may induce window shoppers and browsers to buy. After all, it’s difficult to say no to presents.
Why Should You Sell Overstock Inventory?
Excessive inventory is a sign of poor product management. You may be overpaying on item acquisition.
Overstock merchandise that cannot be sold might cause problems. Excess inventory storage, like additional interest on maxed-out credit cards, resulting in hefty additional carrying costs.
You will be charged for ongoing building upkeep, increased security, employees, and product storage. Not to mention the insurance premiums required to protect the idle merchandise. retain in mind that the slower the stock moves, the more expensive it is to retain. Profit margins will ultimately exceed holding expenses + cost of goods sold (COGS) for outdated or aged inventory.
In the worst-case situation, your storage area may be completely occupied, leaving no place for more material to arrive. Having additional valuables in storage also raises the risk of theft or natural calamities.
And, unfortunately, overstock inventory is locking up capital that could be used to build your firm.
The more cash you have available at any given time, the better, as it may provide actual company security. The same cannot be true for a fully stocked warehouse.
Capital is more malleable than excess inventory. It cannot be used to buy advertising space or marketing efforts. Excess inventory cannot be used to pay employee wages or as payment for new inventory. A shortage of capital was cited as the primary factor for the failure of 32% of small company owners.
Having a low inventory is, of course, a bad idea. Empty shelves, like stagnant shelves, provide nothing fresh to your customers. You’ll have the proper quantity of stock if you order what you need and are aggressive in reducing stale inventory.
