ByExcess inventory is a common challenge faced by businesses across various industries. From seasonal products to fading trends, unsold stocks that pile up can immensely block capital and stock space. However, surplus stock, with the right strategies, can be turned from a liability to a revenue-generating tool. In the world where businesses compete, companies should be active in stock management and find new approaches to sell their excess stock. Besides revenue growth, efficient surplus stock management also contributes to improved cash flow, better storage space optimization, and overall operational.
What is Surplus or Excess Stock?
Surplus stock functions as a backup stock just in case the demand for the product increases or the unsold product accumulates over time due to mismanagement, overbuying, inaccurate demand forecasting or market downfall. Sometime small amount of stock might be helpful in case there is sudden surge in trends or seasonal hikes. However, these stocks can occupy unnecessary space in your storage and in mean time it becomes perishable or damaged goods. This article explores 10 proven strategies to leverage your stock, how to sell surplus stock, setting up clearance sell and many more.
Why is Surplus Harmful for your Business?
To retain surplus can lead to carrying costs such as rent, utility and labor expenses. It reduces cash flow which further hinders possible business opportunities. Unsold merchandise may become outdated, damaged, or lose its market appeal, forcing businesses to heavily discount or even write off the entire surplus inventory. Surplus stock can also lead to overstocking, understocking, and disruptions in the supply chain.
Effective Ways to Leverage Surplus Stock
1. Implementation of Clearance Section
Create a dedicated clearance section, which can be easily accessible and enticing to consumers with significant discounts and offer additional incentives, such as buy-one-get-one deals, to encourage impulse purchases. The clearance section will effectively help to reduce overstock or out of trend items.
2. The Bundle Joy
Bundling surplus stock with complementary products or services can be a win-win situation. It clears out excessive stock and provides customers with additional value. If you have an overstocked item bundle it with the most popular or in demand item with a lucrative discount to ensure purchase. Some promotional ideas are:
- Using surplus stock and new released item together
- Using popular and excess stock together
- Combine your older product in a bundle joy as a free product
- Giveaway the overstocked product as freebie if a minimum amount of purchase is done
3. Leverage Flash Sale
Flash sales can be utilized for creating buzz and sense of urgency around your surplus product or service. With an enticing discount and limited time offer, the product will appear more alluring to the shopaholics. You can promote your flash sale by email and targeted marketing strategy to maximize the impact and drive sale.
4. Live Selling
It is an emerging marketing trend, where live streamers show their products through live streams on social media platforms. They highlight the product information and interact with customers in real time. It enhances customer experience, and the call-to-action work surprisingly effective.
5. Surplus Stock as Promotional Gifts/ Freebies
Everyone loves freebies! If you have significantly low-cost and slow-moving products this is the best strategy to implement. You can giveaway surplus as promotional gifts to customers, employees, business partners or influencers for promotion. These strategies will maintain the outflow of stock and provide customer satisfaction.
Approaching influencer marketing with promotional gifts can be effective, sending them a PR package will earn you genuine reviews, plus you don’t have to pay them for marketing. While sending PR packages always consider micro influencer under your product niche. They have a strong hold on your targeted audience which can drive your overall sales.
6. Social Media as a Tool for Marketing Campaign
Social media is a highly effective and budget friendly platform to market and clear surplus stock. With targeted advertising and engaging content, business can create a buzz around their excess inventory and showcase their clearance deals, flash sales, and limited time offers, creating a sense of urgency and exclusivity for the customers.
7. Consignments
Consignments can be a great option for offloading surplus stocks without heavy discounting. Basically, it allows business to sign consignment deals, which is items are only paid for after they are sold. Here consignment partners handle merchandising, marketing, and customer interactions, this lessens the burden while still generating revenue from surplus goods.
8. Donate to Charitable Organizations
If you have applied every strategy but still can’t clear your excess inventory, consider donating it to charitable organizations or non-profits. It will empty your inventory, add value to your business and give valuable support to worthy causes. Many businesses donate to charity, homeless shelters and non-profit organizations to build brand awareness and to receive positive feedback from the community.
9. Liquidation
The last resort is the liquidation of all surplus stock when every other avenue to selling it has been explored. Liquidation is selling out excessive stock in bulk, often at large discounted price to the liquidator or buyer who deals with clearance materials. Liquidation is often less profitable as compared to the traditional sales channels, but it helps businesses to get at least some fraction of investment that was tied in surplus stock. By using this method businesses can rapidly clear the storage space, free up the invested capital, and wipe out the chance of business losses to obsolescence or degradation through the goods that are not being sold.
10. Implementing Effective management
The above strategies are effective for selling and boosting revenue from the surplus stock, but the ultimate goal is to minimize overstocking. Overstocking can be minimized through implementing effective inventory management by using data analyst for demand- forecasting and real- time stock monitoring. By optimizing your inventory, you can reduce the accumulation of surplus stock.
Conclusion
By implementing the above strategies, you can effectively leverage surplus stock to boost revenue, clear out excess inventory and generate continuous cash flow. Remember to continuously analyze consumer behavior, ebb and flow of market trends, and inventory updates to refine your approach and maximize the potential of your surplus stock.
