Categories: Inventory Management
By Mark Tomalonis
Principal, WarehouseTWO, LLC
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The #3 easiest way to reduce excess inventory is...
There is no #3.
Sorry, folks. Fully recovering your investment in what is now excess inventory is hard. Very hard.
Experience has taught me that recovering one’s investment requires multiple initiatives, managed by a dedicated resource who understands your products and your suppliers’ policies, and is paid an obscenely high incentive (e.g., 10% of the amount of investment recovered). This dedicated resource might be an employee on a six-month full-time assignment, or an employee assigned to excess inventory reduction on a specific day every week for a year.
For that dedicated resource, here are some helpful articles:
Got Surplus Inventory? Who Else Knows?
Your Dead Inventory is Your Lemonade Stand
Is “Inventory-Sharing” a Solution to Your Surplus Inventory Problem? Maybe.
Enhanced WarehouseTWO Tools to Expose Surplus Inventory to a Larger Audience
To reiterate:
The best “easy” way to reduce excess inventory is prevention: manage your inventory and purchasing decisions better.
The fastest “easy” way to reduce excess inventory is to throw it away.
Every other method of reducing excess inventory is hard. Regardless, you ought to deploy dedicated resources to work on multiple efforts to recover at least some of your investment in what is now excess inventory.
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About the Author
After a successful career in sales and operations management in the wholesale-distribution industry, Mark Tomalonis is now principal of WarehouseTWO, LLC. He amuses himself by writing articles, such as this one, to help wholesaler-distributors execute their operations better. Mark’s articles and tips are published in WarehouseTWO’s monthly e-newsletters. Click here to subscribe.
About WarehouseTWO
WarehouseTWO, LLC is an independent “inventory-sharing” service created exclusively for durable goods manufacturers and their authorized distributors, and for any group of durable goods “peer” wholesaler-distributors, such as members of a buying/marketing group or cooperative. To learn how inventory-sharing with WarehouseTWO can help your business, visit the WarehouseTWO website, or email info@warehousetwo.com.