Excess stock is one of the most common problems in any business that holds inventory. Nothing's wrong with the goods. There's just too much of them. And the longer they sit there, the harder they are to shift at a decent price.
This guide covers where excess stock comes from, what it's really costing you, and the realistic options for clearing it, including selling to a specialist excess stock buyer.
Start with why it's excess
Before deciding what to do with the stock, it helps to know how it got there. The cause usually points you towards the right exit.
- A forecast missed. You bought for demand that didn't arrive. Sometimes it comes back, often it doesn't.
- Minimum order quantities. You needed 500, the supplier's minimum was 2,000. The first 500 sold.
- Slow movers. The line sells, just nowhere near fast enough to justify the stock you're holding.
- A lost customer or contract. Stock bought for a specific account that changed its range or walked away.
If demand is likely to come back soon, holding a small buffer can make sense. If it isn't, every week you wait usually means a lower price.
Work out what it's really costing you
Excess stock feels free because you've already paid for it. It isn't. Every month it stays on the racking, it costs you in ways that don't show up on a single line of the accounts.
- Space you could be using for lines that actually sell
- Cash tied up in product instead of in the business
- Falling value as packaging dates and newer versions arrive
- Handling, insurance and stock counts on goods going nowhere
A simple test: if you wouldn't buy this stock again today at the value it's sitting on your books at, you probably shouldn't keep holding it.
Your main options for selling excess stock
1. Discount it through your own channels. Fine for small quantities. The catch is that heavy discounting can train customers to wait for a sale, and it eats into margin on your full-price lines.
2. List it on marketplaces. You'll reach more buyers, but you'll pay fees, handle returns and spend staff time listing and dispatching individual orders.
3. Send it back to the supplier. Worth asking, but restocking fees are common, and it's rarely an option for stock bought on a minimum order quantity.
4. Sell it to an excess stock buyer. One sale, one payment, and the stock is collected. The price per unit is lower than retail, but there are no fees, no staff time and no waiting to see what sells.
How to get the best price from a stock buyer
- Send a clear stock list with descriptions, quantities and, if you have them, cost or RRP
- Include a few photos, showing the packaging as well as the product
- Be upfront about condition. Surprises at collection only slow things down
- Say where the stock is held and whether it's palletised
- Get in touch sooner rather than later, while the lines are still current
Selling the whole lot in one go usually gets a better overall deal than cherry-picking the best lines and leaving the rest behind.
When it's not just excess stock
Some of what's on the racking might not be excess at all. Christmas or summer lines are better treated as leftover seasonal stock, and customer returns have their own considerations, covered in our page on selling retail returns. We can value all three in the same deal.
If the stock comes from a business closure, insolvency or a discontinued product line, our sister site Liquidate Your Stock is the right place to start.