Excess Inventory: How to Liquidate Old and Surplus Stock in Retail

Among many things that changed in the retail industry during the Covid outbreak was the fall of foot traffic to stores. This led to an excessive amount of residue stock that brands were unable to sell out. As the shift between digital and physical retail continues to evolve, there are more than many ways to eliminate excess stock.

To maximize sell-out and decrease the inventory holding costs, you may choose among these ways that better suit your business needs. Every retailer has its prioritization, but one of these liquidation tactics will surely suit you. Some of them focus on customers, and some focus on stores, but all focus on Urgency, Visibility, and Units.  

1. Promotions are the key

Promotion Sample - Image: Pinterest

“My customer does not like offers!”; said no retailer ever. Our customers love the fact that they are buying more with less. The best way to see those inventory levels go down is to offer them campaigns and promotions. Let’s say you have a lot of inventory at basic t-shirts. Just tell your customer that if they buy in bundles, they will pay less per piece.

Related: 12 Successful Retail Pricing Strategies Every Retailer Should Know

These popular bundle campaigns are the driving force for GAP companies to increase their UPTs while disposing of those basics. Because everyone knows that you can never have too many basic t-shirts.

Some other examples for this type of liquidation technique are the "2nd item 30% off", "buy 3, pay 2", "buy 2, pay 10 USD less" etc.

2. Get your products moving around


Imagine this season’s top-selling item. You know everybody wants to see those on the frontier shelf where they can quickly grab it. Why don’t you pick some of these excess items and design your merchandising accordingly so that they’ll pay less to the excess ones?

These kinds of promotions will guide your customers to notice that product that may have been out of their context until they see one.

The most famous example is the diapers vs. beer case study. Once a supermarket wanted to sell more beers to its target male customers, and what they did was in addition to the actual alcohol section, they added a few cans to the diapers area. So, when a frustrated dad is buying the diapers, they also bought a few cans of beer.

Similar examples can be adapted to the online stores are well, so you can mix and match popular items with less popular ones to increase visibility.

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3. Let’s talk about retail gamification

Everybody loves games, and store employees love bonuses. Why not create a game that stores can receive more bonuses?

To do that, you may work with your HR team or your store manager and make sure that they’ll get more rewards if they liquidate these excess items in store.

They’ll surely want to get more space at the back office to receive more products while increasing their monthly earnings. These retail gamification techniques provide friendly competition between your store no matter how many you have and get your store employee more involved in inventory management.

4. Urgency thrills: flash sales

This is one of the most exciting ways to get those customers lined up at your store or online channel.

Tell them that these items will be missed if they don’t act fast! Throw in those flash sales for a few hours and remind them they NEED those items before running out.

5. Why not sell them in bulk?

Your excess items may be painful for you to carry around, but another business may need them urgently.

You may sign up to B2B sales platforms and sell these items in bulk, or you may find a local dealer looking for liquidated products to buy and sell at another market or maybe another region. You’ll give in less effort to make these deals, and all of the stock will be gone permanently.

6. Add another channel: online marketplaces

Online marketplaces always need more items to increase their visibility and win at competition with other marketplaces.

Talk to a marketplace like Amazon or eBay, and let them know that you may give them many SKUs at a negotiated price. They’ll either buy them all or make you an offer so you can use their website as another channel.

7. Try price comparison sites

Some products just can't be bought without looking at Shopzilla or PriceGrabber.

If you have one of these products in stock, join these platforms and make sure you have the best price available. This will put your listing to the top and definitely will attract more customer attention.

8. Use the power of marketing automation & loyalty

Marketing automation has been a top-notch issue for retailers in the past couple of years.

Even though you’re not working with a professional agency, the retailers know their customers’ actions by heart. If you’re using a tool to automate these actions, you may set up a funnel that will send a good offer for these products to the customers at the risk of churn.

If you’re a small business having closer relationships with their customers, why not give them a call and tell them that they have a special offer at these products.

Related: 14 Real-Life Examples of Amazing Customer Service in Retail

9. Alter your digital marketing strategy

Facebook Ads Sample - Image: Pinterest

Even if you are a physical retailer or an online business, you all use digital marketing channels to make sure your products are discovered.

Why not create a retail digital marketing campaign with a feed that’s specially designed for your excess inventory. With the right channel and strategy, you can make sure you’re showing these items precisely to the right people, so with a small advertising budget, you may receive a high return on your investment.

Plus, you don't necessarily need to decrease your prices.

10. Award your loyal customers

If you want to let them go, why not offer them for free? You may use this tactic to increase your foot traffic to the store. If you give an item for free with each purchase or an invoice above a certain amount, customers will come to your store and buy other things to receive that gift because gifts have a proven effect to make people happier. Happiness is one of the primary triggers for shopping, isn’t it?

Related: 15 Creative Retail Display Examples to Increase Foot Traffic and Sales

These are the top ten ways to get rid of excess stock. They are easy to implement, not much time-consuming, and you may not lose a lot of profit when they’re in action.

The amount of liquidated stock will surely be your main KPI. Still, there are additional KPIs you can measure with these efforts, such as increasing brand visibility, loyalty, and, most importantly, foot traffic.

With Dor, you can analyze the foot traffic before and after your selected liquidation method and plan your store capacity and employees even before the customers arrive.  


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