Why There Will Always Be Closeouts, Excess Inventory and Liquidations


selling closeouts, liquidating entire inventory, closeouts, getting rid of inventory, overstock buyers, excess stock

Inventory management is a complex and challenging task for any business. Even the most well-run closeout companies can experience problems with overstock inventory, closeout companies can experience problems with overstock inventory, closeouts, and excess stock. These issues can have a significant impact on a company's bottom line, and they can be difficult to resolve. Whether you have too much inventory due to slow sales, obsolete inventory, canceled orders, of because you are shutting down operations, it is a normal part of running a business.

We will discuss the reasons why companies will always have to deal with closeouts, overstock inventory, and excess stock. We will also provide some statistics about these issues and discuss some of the strategies that companies can use to manage them. Closeout companies are businesses that specialize in buying overstock and dead inventory at deep discounts, and reselling these goods into the secondary closeout discount market.

Why Companies Will Always Have to Deal with Closeouts

Closeouts are a type of liquidation sale that occurs when a company has excess inventory that it needs to get rid of. This can happen for a variety of reasons, such as a change in product strategy, a product recall, or a seasonal change. It can also happen when a company needs to clear out old stock for new products coming, or if you are going out of business and no longer need the product.

There are a number of reasons why companies will always have to deal with closeouts. First, it is simply impossible to predict demand perfectly. Even the most experienced retailers will sometimes end up with too much inventory in the warehouse. Second, changes in the market can quickly lead to excess inventory. For example, if a new competitor enters the market with a similar product, the demand for your product may decline. Finally, even if you do a good job of managing your excess inventory, there will always be some items that simply don't sell. You may have priced your inventory too high, leading to disappointing sales, or you may have the wrong packaging, and even the wrong product line completely. If you need to move old inventory, a simple Google search may help you find the right closeout liquidator. Try using terms like overstock buyers, closeout companies, closeouts, product liquidators, excess inventory buyers, shutting down operations, or liquidating entire inventory.

Statistics about Closeouts

According to a study by the National Retail Federation, retailers lose an average of $166 billion per year due to excess inventory. This includes everything from closeouts and excess inventory to obsolete stock and unsold inventory. The study also found that closeouts account for about $25 billion of this loss.

Overstock Inventory and Excess Stock

Overstock inventory is simply inventory that is in excess of what is needed to meet demand. Excess stock is similar, but it refers to inventory that is no longer needed or wanted by the company. There are all different kinds of buyers who are willing to take on problem inventory and help you get rid of closeouts, liquidation inventory, overstock inventory and excess stock. Also, it applies to all categories. In other words you can find a buyer whether you have excess inventory of toys or sporting goods, closeout handbags, wallets, accessories, or even too much inventory of pet products and lawn and garden inventory.

There are a number of reasons why companies end up with overstock inventory and excess stock. These reasons include:

  • Poor forecasting: If a company does not accurately forecast demand, it may end up with too much inventory and closeouts that take up valuable warehouse space.
  • Product changes: If a company changes its product mix or introduces new products, it may end up with excess inventory of older products. This leads to the need to move out excess inventory and move on to new products.
  • Seasonal changes: Some products are only in demand during certain seasons. If a company does not sell all of its inventory of these products during the season, it will end up with excess stock, closeouts, and overstock of last seasons goods.
  • Returned merchandise: Customers often return merchandise to retailers. If a retailer does not sell this merchandise, it will become excess stock. If it sits in the warehouse too long, you may need it to an outside 3PL storage warehouse or donate it for nothing just to get it out of your warehouse. Closeouts and dead stock sitting idle in a warehouse are costly and can easily affect the bottom line.

Statistics about Overstock Inventory and Excess Stock

According to a study by the Aberdeen Group, the average retailer has about 15% of its inventory sitting in overstock discontinued merchandise or excess stock. This represents a significant financial loss for retailers. Strategies for Managing Closeouts, Overstock Inventory, and Excess Stock

There are a number of strategies that companies can use to manage closeouts, overstock inventory, and excess stock. These strategies include:

  • Improve forecasting: By improving their forecasting, companies can reduce the amount of overstock inventory they have.
  • Reduce lead times: By reducing their lead times, companies can get new products to market more quickly and avoid having excess inventory of older products. It may help to downsize your warehouse and hire an outside 3PL warehouse to handle your closeouts and overstock inventory for you. This may be more costly, however, it may also make your operation more streamlined, in the end leading to fewer closeouts and less old inventory sitting in your warehouse. It is also a great way to get slow selling products and dead stock out of Amazon FBA warehouses.
  • Use consignment: Companies can use consignment to sell excess inventory to other businesses. This can help them to liquidate their inventory quickly and without taking a loss. There have been closeout buyers for generations, and many of today's largest closeout businesses are being run by second generation owners.
  • Liquidate inventory: Companies can also liquidate their inventory through auctions or online sales. This can help them to recoup some of their investment in the inventory. They won't get back the entire cost, but liquidating inventory and getting rid of everything in one fell swoop can only happen at a deep discount.

Closeouts, overstock inventory, and excess stock are a fact of life for any business. However, there are a number of strategies that closeout companies can use to manage these issues. By improving their forecasting, reducing their lead times, using consignment, and liquidating inventory, companies can reduce the amount of money they lose due to excess inventory. In addition to the strategies mentioned above, companies can also use a variety of other techniques to manage closeouts, overstock inventory, and excess stock. These techniques include:

  • Pricing: Companies can offer discounts on closeout merchandise to encourage customers to buy it. This can be part of the liquidation process.
  • Marketing: Companies can use marketing campaigns to promote closeout merchandise and attract customers. Closeout websites and closeout brokers can also be helpful in getting rid of old inventory.
  • Donating: Companies can donate closeout merchandise to charities or other organizations. By using a combination of these strategies, companies can manage closeouts, overstock inventory, and excess stock effectively and avoid losing money.

Merchandise USA has been a closeout buyer for almost 40 years. We specialize in helping companies that are liquidating entire inventory, shutting down operation, or downsizing 3PL warehouses to make room for new products. We buy and sell closeout handbags, overstock pet products and liquidations of all products including closeout lawn and garden inventory to excess stock of housewares and home goods.