Having too much excess stock (or spare capacity) can be a challenge for a business. Not only does stock take up precious storage space, but it ties up capital and can restrict you from investing in things you need, which can hold your business back in the long run.
Costs to Your Business
Storage Costs
Holding a large volume of excess stock means you need a lot of space to store it. Storage warehouses and units are an additional expense to your business, as are higher insurance costs on the inventory.
Deterioration and Shifts in Demand
The longer you keep your stock sitting there ‘gathering dust,’ the more likely it is to deteriorate or become obsolete over time. Certain products are perishable, so you may struggle to sell them further down the line. Or perhaps, if it’s left too long, the product may become obsolete, like some electronic devices.
Restrictions
When capital is tied up in too much excess inventory, it can hold a business back in terms of investment and growth.
What changes could you make to your business if you had access to additional capital?
How to Reduce Your Excess Stock
Remarket and Reposition
When selling online, your shoppers need to be convinced to purchase based on what they see. High-quality images are a set standard and add credibility to your brand and products. Source a professional photographer and work out the best backdrops, angles and lighting to sell your products. Use catchy headlines and descriptions. Your headline and description will make or break a sale. List the best features and pertinent details like shipping. If the customer has to find or ask for information, they’ll leave their shopping basket and buy elsewhere.
Bundle Products
Whether you are a retailer or specialise in a service, you can package the items you’re selling. By grouping slow-moving products with high-demand products, you can move them quicker. Customers who are interested in purchasing the high-demand products will see the bundle as a bargain. You can also save on postage and packaging — a bonus for both the buyer and seller!
Expand Your Potential
Bartercard helps companies effectively use inventory, equipment, and employees, converting downtime and spare capacity into new revenue that would not have been available otherwise.
“Hotels have the most perishable stock on the planet – if we don’t sell a room tonight, it’s never available for sale again. Most retailers, if they don’t sell their product today, it’s still available for sale tomorrow. It’s not the case with hotels; the sale is lost. Bartercard is another tool we use to ensure those rooms are full and don’t sit empty.”
“It’s become a really effective way of selling our facilities as it’s opened up a new market for us and has helped us secure guests that are not in the cash market.” – Peter Tennent, The Devon Hotel
You can sell excess or unwanted stock without the need to discount heavily, which can reduce perceived value and risk a potential price war with competitors.
Bartercard can work particularly well for businesses that experience seasonal markets.
A Win-Win Scenario
By selling excess contra or slow-moving inventory through the Bartercard community, members receive Trade Dollars as payment. These can then be spent on goods and services for their business while conserving cash for other expenses. It’s a win-win.
