Following my 3 part blog series covering 10 steps to right-size your inventory, part 1 of which can be found here, the next question you should be asking yourself is, “what do you do with all of this inventory?” In this blog series, we have discussed 7 of the 10 ways to get rid of the dead or excess inventory which has been identified by your analysis.
Consider kitting: Consider packaging the product that is not moving with some other popular item and moving it that way. You might not get top dollar for it, but you will get something and you will work the inventory out of the system.
Make sure when kitting the products have some level of relation. You don’t want to completely random items together. Think it through strategically so you can move the most inventory while still maximizing your profits.
Join Excess Inventory Networks: There are companies that deal with getting rid of excess inventory as a business. Consider networking into these groups so you can get rid of the excess inventory through these channels. For example, you can find several groups where excess inventory is the main topic. (Search “Excess/Surplus Inventory” or “Inventory Sharing Communities” on LinkedIn Groups or Google.
At a recent trade show, we again met a friend, Mark Tomalonis, of service provider WarehouseTWO, LLC. This service facilitates manufacturers and their wholesaler-distributors to have visibility of all of the inventory available in the manufacturer’s wholesale channel. One participant’s stock item (active or surplus) is available to fulfill another participant’s non-stock backorder demand. Such collaboration can be an excellent addition to your overall inventory management strategy. Check it out at www.warehousetwo.com.
Try E-Bay or other auction sites: Depending on the product, E-bay and other online auction sites might be a viable option to consider. Google “Online Auction Sites” for details, or try Craigslist which is a great way to sell large items locally with a free listing.
This may not be the most financially successful route because this auction sites are often used to get the lowest price possible, but it is better than having your inventory just sitting on your shelf. At least this way you’re not costing the company money on hand by not giving that shelf space to needed inventory.
If nothing else works, write it off or donate it. Remember, worthless inventory does not improve with age. All it will do is use up space and money. Once you know it is not moving, write it off or donate. This applies to your dead inventory and provides a tax benefit.
What do you think of these additional 3 ideas? I’d like your feedback and to hear examples of how you’ve used these ways in your business and which you’ve found most beneficial!