Excess inventory is a term in inventory management that arises basically from poor management of the general life-cycle stages of a product or its stock demand. Excess inventory can as be referred to as overstock, excessive stock or excess2sell.
Having excess inventory generally places a lot of strain on the organisational resources in trying to clear them, and it also has an effect on a company’s bottom line. Often times, when a company begins to run into excess stock, this can be a sign of the declining stage of the product lifecycle.
Inventory reduction can be an issue if not well approached. Here are a few inventory reduction strategies for a more effective approach. Understanding these strategies will require that you implement the best inventory control methods. Regular monitoring of your inventory management system to know the length of time the stock has been sitting. This will help determine when it becomes excess stock, and to start implementing the reduction strategies.
Some of These strategies include:
- A webpage set aside only for the sales of these items.
This is a very good approach to inventory reduction. Consider it more like an online store. This webpage gives you a platform to showcase these products in excess, give discounts and more, taking the form of an e-commerce website design. This webpage has to be properly designed and well-positioned navigation buttons to help customers access offers, discount code and the sales page. Depending on what your excess stock might be, you should take into consideration the e-commerce design of your webpage, whether it’s starting an online clothing store or any other. A proper design and layout should be given.
- Mobile app development
In addition to your e-commerce website, you can consider a mobile commerce platform like an app. The app will help customers easily access your services straight from their mobile phones. They can receive alerts on discounts and offers available. This can serve as a very good e-commerce solution, and without much stress, there are a number of app building software or phone app creator, whichever name you might call it, that would help you get your app running. This is smart, smooth and can be efficient enough.
- A promotion
A promotion or a giveaway is another wonderful strategy that attracts customers and even raises the overall demand for that stock. This giveaway strategy can be done through email, in your store or even social media channel to spread the word.
- Creating a Pop-up store or Starting an online store
This is a great way to help your stock reduction process. It can be set up anywhere. The good thing is there are available sites that can help structure this pop-up store for you, so all you have to do is focus on selling your products.
Donations to charity is one easy way to lay off excess stock. You would be supporting a good course, and it also builds your reputation and publicity.
- Extend return policy
An extension in return policy can serve as an incentive to customers. Generally, people feel safer knowing that something they bought can be returned. Not often do people return items within the first week. This strategy would not make such an impact on actual returns.
- Trading your stock with another seller
This strategy involves you switching your stock with other sellers. You can move your old stock and vice versa. With this strategy, you can advertise as ‘New Arrivals’ or ‘New Stock Available’, this attracts customers into purchasing while they are ‘fresh and new’.
- Match these excess stocks with bestsellers
Getting out your excess stock with bestsellers is another wonderful strategy of inventory reduction that is often ignored. Whether on a website, webshop or physical store, match up these excess stocks as a related product under these bestsellers. This way you give these stocks more visibility and customers tend to go for them, probably as an extra to their purchases.
- Rebranding these products
On more thing to consider as a strategy in inventory reduction is rebranding. This involves improving the outward appearance and the general overview and description of the product. This makes the product more eye-catching than it was before.