Buying inventory is like buying eggs. If you buy too many at once, some will go rotten over time. Supposing you have made the mistake of purchasing too much stock at once, you will end up with some stock the next season (or even worse, the season after that!) that your customers have all seen. You don’t want to make a loss but inventory that doesn’t shift is slowly depreciating anyway. It is costing you in storage costs and unfortunately it is also giving visitors a bad feel about your shop – if goods aren’t moving, what is wrong with them, they’re wondering. Depending on just how old the stock is you can try a number of different strategies to move it.
- Repackage it. Sometimes the only thing that is wrong with the product is its packaging. Can you repackage it? Call it a different name? Aim it at a different target market?
- Sell it as part of a bundle – try it with something popular. Group products together that seem to suit, and sell them at a slightly lower price than if they were bought separately. This will be a minimal hit on your profits.
- Change the way it’s displayed. Move it to an area of the shop that sees a lot of sales. Re-shuffle shelving displays to focus on this product. If it’s an accessory that isn’t selling, like a scarf, put it next to an item of clothing that brings it alive.
- Do a sale. It’s obvious, common and effective. The rule of thumb is the longer you have been holding the stock, the deeper the discount should be.
- Use it as a giveaway. If there are a number of small items, give them away with other products. if the items are of high value use them as prizes in an event. Customers will appreciate anything for free and are unlikely to complain that it’s last season’s stock if they received it free.
- Offer a promotion. Rather than just discounting products, consider using the discounts as a way to bump up overall sales. It might be buy X Product and get Y Product at half price, or Buy 4 X Products and get a 5th free. This is a great way to avoid damaging your bottom line too much.
- Sell it on another website- eBay, Amazon, Gumtree or one of the many Daily Deals sites. These websites all come with a ‘built-in audience’ who are looking to pick up great bargains. They may not be your ideal everyday target customer, but if your ideal customer hasn’t bought your old stock yet you need to retarget.
- Rather than have it giving a bad feeling to your shop – donate it to charity. Publicising your philanthropic activities will mean customers will feel an emotional connection to your shop and you may even be able to claim back some of the value of the products as a tax deduction.
Most businesses at some time or another have excess stock they want to move. It is not a great position for your business to be in, but improving purchasing and inventory control will reduce the likelihood of this situation occuring. Look at the challenge of moving old inventory as an opportunity to learn, and above all – don’t buy so much next time!