Do you have inventory that is over a year old? It could actually be costing you money. It does so by taking up space that profitable product could be using and by requiring regular movement.
Sometimes, as a shop owner, it can be difficult to let go of merchandise because we know how much it has cost and how much work we have put into selling it already. Unfortunately, the time comes where that merchandise starts costing us money. The general rule of thumb is that merchandise shouldn't hang around your store for more than a year, so you need to consider clearing out aged inventory to make room for newer, more profitable items.
How is it costing us money?
Aged inventory takes up space and ties up inventory dollars that could otherwise be spent on new, more profitable merchandise. It can also add clutter to the store or space, inhibiting sales of new product. Once you consider that, consider also how many times you've paid someone to move that product or moved it yourself. Not only is their time worth money, but so is yours! What could you have been doing to make the store money instead of moving aged merchandise?
Okay, that's great, but what are some solutions to this problem?
Remix, repackage, reintroduce, or repurpose items before having a clearance sale. Need to know more? Sign up to receive the Flourishing Retailers Tip, sent directly to your inbox, and receive answers plus a special bonus tip this week! All you have to do to sign up is click here!
Melissa Mainville is the owner and operator of Flourish Design & Merchandising. She has a passion for retail and tons of experience in the industry. Learn more here.