4 Ways to Deal with Slow-Moving Inventory
Slow-moving inventory is often a waste of resources... and also a big pain in the back (of your warehouse). Here is how you can deal with it.
MOVE [Inventory], Get Out The Way
Slow things in life tend to suck: Traffic, computers, government paperwork. The demise of Smash Mouth.
This same slow=sucks rule also applies to eCommerce. Then again, if you have any products with a long sales cycle, you are probably already aware that slow-moving inventory can be quite problematic.
How problematic? Let us count the ways. Slow-moving inventory:
- Occupies warehouse real estate
- Ties up financial capital
- Messes up cash flow
- Throws a wrench in supply chain management
- Takes time and attention away from better selling items
Now, before we dive into how to deal with your slow-moving inventory, we need to answer one very important question: What, exactly, qualifies as “slow-moving products”?
Ultimately, that is something that you and your company will have to determine. Depending on the kinds of products that you sell, it could be anywhere from 90 days to 180 days… or even longer. It is important that you and your inventory management team establish this number early on, so you are aware of when items have crossed the line.
So what can you do with slow moving inventory? We're glad you asked! Here are 4 ways to deal with it today:
1. Basket Analysis
There is a lot that you can learn from analyzing your customer’s purchasing patterns. When it comes to slow-moving inventory, getting the answers to a few key questions will likely help you move those items:
- What kind of customers are buying these items? In other words: What demographic should you be targeting here?
- Which items are often purchased together with these items? Is there an opportunity to offer a bundle deal?
- Are there people putting these items in their checkout basket, and then never actually purchasing it? Can you identify the pain points that are causing this, and solve them?
2. Win Win Win No Matter What
Sales and Discounts are great because everybody wins: your customers get a great deal, your marketing and sales teams get to be creative, and your warehouse clears up some space. Another great benefit is that buyers have no way of knowing that this is your slow-moving inventory — all they see is the steep discount, and an opportunity to save some serious cash.
3. Swap or Liquidate
If even lowering the price significantly won’t help you move these items to consumers, then you might want to consider using your relationships with other businesses. You can either set up a barter to trade for some other product or service, or you can hire liquidators to quickly sell your products and clear shelf space.
3. Give it Away
When all else fails, and it seems like no one will give you ANYthing for your slow-moving inventory, you can always follow the advice of the Red Hot Chili Peppers, and Give it Away. There are many ways to do this, and they all have different benefits to you and your company:
- Charitable Donations
- Giveaway on Social Media
- Promote them as a gift once a threshold amount is reached on a sale
- Add them as a surprise gift on shipments
Make sure your inventory moves faster than Flash the Sloth
Just because you have slow-moving inventory, that does not mean that you should be slow to find a use for it. Unless you are a sloth in a Disney movie, of course, in which case the slower you are to do anything, the more hilarious you become.
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