Inventory management for your e-commerce business requires a constant check. As an online seller, at some point of time, you are likely to experience the situation, when your stocks are piled up and not moving as you expected. The question arises how can you get rid of that slow moving inventory.
While you are busy earning profits from your top selling products, do not ignore the slow moving inventory. Because when stocks don’t move, there is a significant amount of costs attached to it.
Basically, a slow-moving inventory is a stock for which there is decidedly less or no sell at all. A catalogue which you have not shipped from the past three to five months and has a relatively weak demand.
Many a time, retailers order goods in a good quantity (more than required) to get the bulk discount and to minimize per unit purchasing cost which ultimately results in excess stock.
There is two major problem associated with slow-moving inventory.
1. It prevents room for faster-selling products by occupying warehouse shelves.
2. Your financial capital gets stuck, and it hinders the profitability of your business.
Do not let the slow-moving inventory tie with the valuable capital of your business. Here are some awesome tips on how to get rid of excess inventory and make a profit out of it.
1.Return to supplier
In case you share good relations with the supplier you can request him to take the excess inventory back. If no return, try exchanging the old stock with other products. You can speak with the supplier to consider any of the points listed below.
1. The product was not as per the market demand
2. Inventory is not damaged and still unpacked
The supplier may consider your return or exchange request if he wants to keep you as a customer.
2.Stock clearance – EOSS
Holding a clearance sale is an excellent opportunity to get rid of the stock that has not sold from past 3 to 5 months. Reach out to your shoppers via email and social media to inform them about the stock clearance sale.
If you have data about the shoppers’ preference (especially style and size), you can pitch them with the personalized emails. This could be the perfect opportunity to drive them to your store to buy the products.
You can also take the help of EOSS (end of season sale). This not only helps you to sell the excess inventory but also give you new customers who might not have visited your site before.
3.Sell items at lower prices (Drop the price)
Price-drop is an old yet effective way to get rid of your products fast.
Offer a deal that your customers can’t resist. Moreover, in case if you find that such products are already in some of your customers’ cart, then 80% of your job is done.
No matter how lucky you get to sell off all your excess inventory, you still have chances of having left with few items in your stock.
So, in such case, what to do?
Donate the remaining inventory (depending upon the products) to the needy people like the orphanage, old age homes, and there are numerous options you just need to look around.
By doing this, you can get a tax reduction and also stand chances to get your brand noticed by people (brand awareness & promotional benefits).
5.Bundle up items
Bundling up products is yet another way to sell your old inventory faster.
There are many ways you can bundle up your products to make it sell faster.
1. Bundle slow-moving products with fast-selling products
2. Combine multiple slow-moving items as a single purchase
Make sure that you combine complementary products. For example, if your slow-moving inventory includes trousers and belts, sell them as a pair.
Alternatively, you can sell 2-3 trousers as a single order.
6.Make slow-moving products more appealing
Check whether some items are actually slow-moving or are there some other reason behind this?
Many a time a product doesn’t sell because of
1. The poor positioning in the website/catalogue
With many e-commerce sites, it’s not uncommon that specific items don’t sell because they can’t be easily found.
Make sure you make them visible and accessible from website’s main navigation.
Try placing them strategically on the website’s homepage and other forefronts of the category page.
2. Low-quality product images
Retailers, mark that product images can make or break the sale. Put a high quality and attractive pictures of products. When consumers buy online, what do they look at the product image? If they do not find them attractive enough, you lose a sale.
3. Lousy product descriptions
The same thing goes with your product descriptions too!
Read them. How do they sound? Do they sound informative and convincing?
If not, change them.
Provide accurate information about the product features.
More importantly, write product descriptions which sell. Resemble product benefits through its narrative.
4. No efforts have been taken for SEO and promotion of such products
Check how do you rank when people find these products.
Optimize product category pages and product pages.
Try using new keywords in the product title and description. As I mentioned in the earlier point, draft excellent product information which drives sales.
Take efforts to promote these products better.
Promote your slow-moving items through social media and paid ads.
7.Advertise as “best-selling” or “back in stock.”
Another way to increase sales of slow-moving inventory on your online store is, market them as best-sellers.
When your customers are browsing through other products, tell them that these are your best-selling products.
However, before trying this, make sure you follow my tips from point seven.
Attractive product images and description is a must to make your customers trust the word “bestseller”.
You can also promote such inventory as “back in stock”. This gives your customers a sense that many want these products and this can be a good choice to try.
8.Sell to factory outlets/marketplaces
You can try selling slow-moving items on marketplaces like Amazon, Flipkart, eBay.
Since these marketplaces have huge visitor traffic with different kind of product needs, you can find a way here to clear your unsold stock.
This might eat-up your little time to create product pages, but can be a great help to sell slow-moving or surplus inventory.
Alternatively, you can sell your surplus stock to factory outlets that specialize in managing inventory from a retailer.
Remember, these companies are generally wholesalers, and they purchase the stock at a comparatively lower price, and you are likely to make no profit out of it.
However, at least you will be able to save yourself from the loss and shelves taking up space.
9.Offer free shipping
Additional shipping charges lead to abandoned checkouts. Offer free shipping on your slow-moving inventory.
Free shipping often reduces the average order value and note that customers love free shipping.
This may not sound too effective strategy to move stocks, but something is better than nothing.
9.Create urgency to drive sales
Urgency and scarcity can be useful to increase sales of slow-moving products.
Here, your customers perceive that there is a limited stock for the goods which encourage them to make a purchase.
With urgency, your customers are motivated to buy the products because they do not want to miss the deal.
Further, you can introduce exclusive offers for early birds.
Put a countdown on the product page or hold a flash sale which makes your customers buy immediately.
10.Freebies on signup or on specific order amount
You can give away your slow-moving products as a gift above a certain order amount.
This strategy works best for products at low cost. When a product becomes tough to sell, you can give away such item to your customers to increase sign up or a free gift above a certain order amount.
These help to increase signups where you have valuable customer data, and alternatively, it increases the order value.
11.Barter with other companies
Not necessarily if specific products don’t sell on your website, will not be purchased by customers from anywhere.
You can try a barter deal with retailer or wholesaler for other products in exchange for your slow-moving items.
Tips to avoid surplus inventory
“Precaution is better than cure” – A wise person.
Rather than investing time to deal with surplus stock and ultimately putting yourself in a “no profit, no loss” situation, why to not avoid it at first place?
To build a profitable and sustainable e-commerce business, you need to understand the importance of inventory management.
No matter your operation expertise, the type of your products that you sell, the size of your business, the number of customers you serve. If you do not pay enough attention to manage your stocks, this can turn into a most significant challenge for your e-commerce business.
1. Forecast demand – Use past data, trends, and seasonality in your business to make informed decisions about ordering inventory.
2. Let the supplier directly ship products to your customers – You don’t need actually to store any inventory at all.
3. Order lower quantities/order in the cycle
4. First-in, First-out method – Sell the oldest merchandise first.
Every e-commerce entrepreneur meets inventory management challenge at some point of time. However, there are multiple ways listed above to deal with this problem and turn a dead stock into a profitable deal.
If you have some fresh ideas on how to get rid of slow-moving inventory, do share with us in the comment section below.
For any queries, feel free to write us at email@example.com.