Following my 3 part blog series covering the 10 steps to right-sizing your inventory, part 1 of which can be found here, let’s tackle the next question which is, “what do I do with all of this inventory?”
In the first piece of this 3 part blog series (here) I covered 3 ways to get rid of your dead or excess inventory. In this second part I would like to discuss 4 more suggestions to help reduce that inventory.
The same item might be popular in one location and unpopular in another. If you are dealing with this situation, you might consider moving the product to the location where it is still selling. Of course, you will be hit with extra transportation costs but it might be worth it.
This is a good way to help get your company back to a state of equilibrium. You can even reduce your inventory by moving excess inventory in one location to another location that may have low or even no inventory. Using a tool like Cutwater can help you see trends and what products are popular at what locations.
Consider changing packaging
Some products might need to be moved from one package to another in order to get them moving. If you have the facilities needed for repackaging, do so by all means. For example, a product might not see demand in bags, but does sell in boxes. Well, organize the operation to do the conversion.
This can increase customer satisfaction. Being able to meet the needs of someone who needs a lot of one product as well as those who only need a few. Repackaging an item can increase how much a product moves out of your store. If you have 100 units of a product try repacking and creating 200 smaller units. It’s the same amount of product nut you may be able to move it more easily.
Consider substituting the product for some other product for which there is demand, even if you lose some money or profit in the process. Once you have worked out the bad inventory, you will have no need to continue this process.It’s a simple swap. Work on what you know is in demand.
A tool like Cutwater can help with this using its many reports. Substitute what is dead or excess for items you know will move out of your warehouse.
Consider an Exchange Program with a competitor
In some cases, it might make sense to check with the competition whether they have a need for the product of which you have too much. Sometimes, you can get lucky and they might take it.Don’t let your pride get in your way.
There’s no shame in working with your competitors in order to help fulfill your needs. Not only are you getting rid of inventory you don’t need which is just costing you money but now you’re gaining something out of the situation.
What do you think of these four ideas? Can you guess what last three ideas I’ll be sharing in the next blog? I’d like your feedback and to hear any resolutions you have found to be beneficial to your dead or excess inventory!