Clearing Out the Warehouse: Strategies for Excess Inventory, Closeouts and Cancellations

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Sitting on a warehouse filled with old inventory can be a major headache. Excess inventory, closeouts, overstock products, canceled orders, discontinued items, and abandoned inventory all tie up valuable warehouse space, strain your cash flow, and prevent you from bringing in fresh, in-demand merchandise. But you do have options. Here's a comprehensive guide to help you clear out your warehouse and turn that old inventory into cash (or at least, minimize your losses).

  1. Analyze Your Abandoned Inventory:

    Before diving into sales tactics, take a step back and meticulously analyze your excess inventory, closeouts, overstock, canceled orders, discontinued items, and abandoned goods. Categorize them by product type, age, condition, and potential selling price. This will help you identify the most profitable way to move each item.

  2. Fire Sale! Sell Through Closeout Channels:
    • Sales Events: Organize dedicated sales events specifically for excess inventory, closeouts, and overstock products. Promote these sales heavily through email marketing, social media campaigns, and in-store signage. Consider tiered discounts, like increasing reductions as the sale progresses.
    • Clearance Racks: Devote a prominent section of your store or warehouse to clearance racks or sections, showcasing closeouts, overstock, and discontinued items. Ensure these racks are well-organized and visually appealing to attract customer attention.
    • Bundle Deals: Create enticing bundle deals that combine excess inventory with your current bestsellers. This can incentivize customers to purchase the less-desired closeout items and boost overall sales.
    • Flash Sales and Online Promotions: Utilize online platforms to run limited-time flash sales or promotions specifically for excess inventory. This can help you reach a wider audience and clear out overstock items.
  3. Rethink and Repurpose:
    • Repackaging: For certain closeouts and overstock products, consider creative repackaging strategies. You could bundle them with complementary items or create entirely new product sets. This can make them more attractive to customers and potentially command a higher price. If you are downsizing your warehouse, consider taking this aggressive approach before moving your warehouse. Get rid of as much inventory as you can before you have to move or before your lease comes due at the end of the month, or end of the year.
    • Redesign and Upcycle: If feasible, explore redesigning or upcycling discontinued items and abandoned merchandise. This could involve adding new features, changing functionalities, or altering the closeout product's aesthetics. Upcycled products can be marketed as unique and eco-friendly, attracting a specific customer segment.
  4. Explore Alternative Sales Channels:
    • Discount Retailers: Partner with discount retailers who specialize in buying and selling excess inventory, closeouts, and overstock products. While the profit margins may be lower, you can clear out a significant amount of inventory quickly. These closeout buyers often look for name brand closeouts, so if you have branded housewares closeouts or brands of overstock lawn and garden or brand name closeout toys, you may have more luck selling to discount retailers.
    • Online Marketplaces: Platforms like eBay, Amazon Marketplace, or specialized online consignment stores can be excellent avenues to sell excess inventory, closeouts, and even discontinued items directly to consumers. This is a great option for brown box or kraft box packaged closeouts. Online items don't necessarily need color retail packaging so closeouts and excess inventory in plain brown or white boxes may work here. Also, if you are keen to clear stock from ecommerce sales, you may have success selling them to other online closeout sellers.
    • Wholesale Liquidators: Liquidation companies buy large quantities of excess inventory, closeouts, and overstock at a discounted rate and then resell them through their own channels. This is a good option if you need to move a large volume of unwanted inventory quickly. If you need help finding an inventory liquidator, consider an online Google search using these terms: downsizing warehouse moving to smaller space, offloading abandoned stock, shutting down business, liquidating excess inventory, looking for inventory liquidation buyers, selling excess inventory, clear out warehousing space for new products, our company was bought out, looking to liquidate.
  5. Donations and Responsible Disposal:
    • Charitable Donations: Donating excess inventory, closeouts, and discontinued items to charities can be a tax-deductible option. This not only clears out your warehouse but also benefits worthy causes. Ensure the donated items are still in good condition and relevant to the charity's mission.
    • Recycling Programs: For certain types of discontinued items or unusable closeouts, explore recycling programs in your area. This is a more environmentally friendly way to dispose of unwanted inventory and abandoned merchandise, especially for overstock products with recyclable materials.


  • Promote, Promote, Promote! No matter which strategy you choose, heavily promote your excess inventory, closeouts, and overstock products. Utilize various marketing channels to reach your target audience and create a sense of urgency to drive sales. Offloading excess inventory is easier when you reach customers who may be interested. If you are downsizing your warehouse or even closing your warehouse let customers know.
  • Track and Analyze Results: Keep track of your sales efforts and analyze which strategies are most effective in moving different types of excess inventory, closeouts, and discontinued items. This will help you refine your approach over time.
  • Preventative Measures: While clearing out your current inventory backlog is crucial, focus on implementing preventative measures to avoid future issues. This could involve tightening your ordering procedures, improving demand forecasting, and conducting regular inventory audits.

By following these strategies and employing the terms repeatedly throughout your planning and execution process, you can effectively clear out your warehouse of excess inventory, closeouts, overstock, canceled orders, discontinued items, and abandoned goods. Remember, even if you can't sell everything for full price, freeing up valuable warehouse space and recouping some of your investment is a win in the long run. As explained by Tim Cook, CEO of Apple, once said “Inventory is fundamentally evil. You kind of want to manage it like you’re in the dairy business. If it gets past its freshness date, you have a problem."

Merchandise USA is a closeout buyer and inventory liquidator in business more than 37 years. We buy and sell closeouts, excess inventory, surplus inventory, and unwanted inventory. We buy liquidations of all closeouts including overstock hardware, name brand home décor, overstock and excess stock of toys, sporting goods, craft closeouts, and more.