Concept:
“Those 400 left handed brackets for model AS4720 are bound to come in handy sooner or later”.
The trouble is, they never do! Like nearly every business, we’ll bet you have redundant stock clogging up valuable warehouse space, getting in the way of logistics people and costing you money. They may be over-makes, 2nd quality product, discontinued lines, customer cancellations, samples, prototypes, etc.
They may be hidden away on the basis of “out of sight, out of mind”. This just makes the problem worse as it is less likely to be resolved.
Why not turn this dead stock into cash? The product is probably written down anyway and the longer you leave it, the less it will be worth.
Example:
Ask yourself:
- What slow-moving, redundant or dead stock do you have?
- Who could you sell it to?
- Have you assigned anyone to sell the product?
- Could it be sold to new customers at a special price to help you win new business?
- What is the minimum price you’re prepared to sell this stock for?
- How can we ensure that we do not get in this situation again?
Interestingly, companies that have a space problem and make a policy of not taking third party warehousing never seem to have such a big problem with redundant stock, as they have nowhere to put it!
Look for customers who can take a large quantity of the stock in one go, to be delivered immediately. Don’t waste valuable selling time selling dead stock in small lots that cost you a fortune to deliver. Assign one person to the job – this will avoid duplication of effort, selling the same product twice, and the possibility of eroding the value of regular stock.
Remember! This stock is worth nothing until you sell it. Get the best price you can for it now, regardless of the manufacturing costs and without causing conflict with current customers.
