Correctly managing excess inventory has a direct impact on profitability and should therefore be a priority for any business. There are many ways of moving overstock (and these too!), all of which can be implemented on stokkly, but one aspect is key : the correct definition of the sales price. Today, we’ll be looking into how to define your excess inventory sales price.
Why is setting the correct price for your excess inventory important?
In any business or market, setting the right sales price is a key success factor. This is also true – if not even more so! – in the business of excess inventory. Once an inventory item has been qualified as “excess”, it usually enters a separate sales and management process with a specific objective : move it fast, minimise any new direct costs linked to holding it, and move on to something else!
Moving excess inventory in a quick and efficient manner is therefore a good business practice, contributes to better controlling cashflow and ultimately makes companies more agile when reacting to unforeseen market events (having cash available to take advantage of a great purchasing opportunity for example).
Setting the sales price correctly is an important part of this process. Too low a price could mean that the full potential of the excess inventory will not be exploited although the merchandise might sell fast; too high a price could act as a deterrent to potential buyers, even though it may be reassuring from the seller’s perspective to try and minimize losses.
How to determine the correct sales price for your excess inventory
- Knowing the Recommended Retail Price (RRP) for the product to be sold is an excellent starting point. The RRP varies depending on the item’s condition (new or refursbished) and desirability (is it from a current collection? Last year’s collection?) but acts an important point of reference to potential buyers. Use the RRP as a starting point and always include it in your product listing to save your buyers the time and effort of finding it for themselves.
- Consider bundling your products too : offer them on sale by the box load, pallet or even truck load. By doing so, you will be able to cut shipping and handling costs on your side, and as a consequence price the stocklot more aggressively. Bundling also offers the advantage of emptying storage space more rapidly.
- Bear in mind that those who buy your products are also sellers themselves, and will in turn be re-selling the goods purchased from you to end users. Your buyers will be applying a x2 markup on their purchase price, so this too should give you an indication as to what a correct sales price is.
- Be sure to use the catalog feed to list and update your products on stokkly. This will make updating your product info, and prices in particular, an easy and effortless process, but will give the flexibility to adapt your prices to the market, lowering them if necessary or increasing them when possible.
Do you have specific questions about the best pricing strategy for your excess inventory? In that case contact us or request a demo to find out how stokkly can help you optimize your excess inventory sales. You can also create your stokkly seller account now and start selling on stokkly right away.