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“Excessive inventory”, on its face, sounds like a good problem to have.

After all, more inventory means more products to sell, right? But there’s a lot of situations (most situations, we’d say) where too much inventory can start to be a massive problem. Excess items around the warehouse, or inventory you can’t seem to move no matter what, can start to cause giant logistical problems (by taking up too much space on your warehouse shelving) while impacting your bottom line, as every product unsold can take time and money away from everything else in your warehouse.

If this is starting to sound a little familiar, there’s plenty of steps you can take to deal with your current excess inventory and prevent it from coming back. Here’s a few of our favorite methods of dealing with excess warehouse inventory:


Review your inventory for errors: The first step is to make sure everything is being counted as accurately as possible. Inventory errors can lead to excess inventory being reported incorrectly (leading you to believe you have more of a certain item than you actually do), or for shortages to be reported when in fact you have more of a given item than you expect. Review your last few cycle counts or inventory checks and make sure everything is being accurately reported and double-checked across the board.


Understand why it isn’t sold: There’s a number of reasons why a certain product or item remains unsold, but getting to the root of that problem will give you a better idea as to why they haven’t sold and what you can do to prevent this problem next time. Is the item too seasonal and won’t sell during certain times of year? Is it too out-of-style (in the case of something like clothing) or too obsolete (in the case of electronics or consumer goods)? Is it still being sold at full-price even after it’s been on the market for some time? Review your sales figures from when you first received the item to now and see if you can identify a specific trend or issue that may have caused this item to start to build up in your inventory.


Designate an area for the excess inventory: Above and beyond the sales issues, one of the biggest problems caused by excess inventory is the amount of space it can begin to take up. Try to gather up your excess inventory and unsold goods, package them together, and designate a specific part of your wire shelving, pallet racks, or plastic shelving to hold this inventory until you can figure out what you’re doing with it.


Get it outta here: Finally, the lingering problem with excess inventory is that it can’t stay in your warehouse forever, but how will you know where to send it? You have a few options for finally moving these items, depending on various factors. The most common strategy is to try and blow it out in a huge clearance sale, with a discount that people won’t be able to say no to. Otherwise, you may be able to bundle it as a free gift with other purchases (which can lead to a loss, but it’ll pay off in the long run as you no longer have to waste money or time organizing it), or even see if you can still return it to the vendor (which again can lead to a loss on shipping costs, but at least it won’t be taking up space in your warehouse anymore).

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