Running a retail business demands intellect and instinct. You need to manage stock and supply to ensure you always have the cash and space you need to grow and expand. Excess stock is a problem that can happen to anyone. It can take up back-room or shelf space, tie up capital and prevent you from investing back into your business. Managing stock requires attention to detail, an awareness of product movement and a clear view of inventory. And no matter how well you plan you can still end up with excess inventory thanks to issues outside of your control. Fortunately, there are ways to manage this.
Here are five smart ways to take that surplus stock challenge and turn it into an opportunity.
1. Refresh, re-merchandise or re-market
If you don’t have any luck, consider lowering your prices. You can use this as an opportunity to create a sales event such as a flash sale or running a storewide promotion.
Are you marketing the product properly? Sometimes it isn’t so much the stock that’s the issue, but how it is perceived by the customer. If you’ve got a shelf of surplus that nobody wants, try to refresh your marketing efforts. It’s a good idea to do this in conjunction with repositioning the products in the store. Switch up their shelf arrangements or put them in a different place. Also, consider refreshing the attitude of your staff as they can be key to engaging with customers and shifting those products.
2. Invest in the strategic discount
If you don’t have any luck, consider lowering your prices. You can use this as an opportunity to create a sales event such as a flash sale or running a storewide promotion. This can have the added advantage of bringing customers to your store. Add in some bells and whistles, build the ‘if I don’t get it now, I’ll lose out’ mentality, and make it more about the experience than the sale.
It is important to time your sales carefully and to minimise the times you do them. Too many sales means the risk of losing engagement and allure, and customers may begin to wait for your sales before they do their shopping. Also use sales as a chance to capture critical customer data that you can add to your loyalty programme or newsletter.
3. Bundle up
Bundling is the second-most popular pricing method for retailers across all sectors, according to Software Advice, with an impressive 90% of retailers using this tactic in their business. Climb on this bandwagon by grouping certain products together and selling them for a lower price than if they were sold separately. You can bundle multiple units of the same item, add complementary products to increase the value or pair slow-moving products with popular ones.
4. Incentivise and inspire
Low-cost items are perfect for this strategy. If they just won’t sell, use them as giveaways or incentives that inspire people to sign up to mailing lists, newsletters and other marketing initiatives.
5. Sell them to online marketplaces or liquidation companies
Online platforms such as OLX or Gumtree can work as an alternative sales space to shift excess stock that just won’t move. You might not see a profit, but they’re a great way of getting rid of stock.