How to Get the Maximum Return For Your Excess Inventory
When the economy gets tight, consumer spending gets tight, and when consumer spending gets tight, excess inventory is bound to happen. If you’re considering liquidating your excess inventory, there are many options to consider. This article will help you determine what your best course of action is.
You have 3 possible options:
- Sell your products using either an online or offline auction
- Simply give your products to an organization as a donation
- Hire a specialized liquidation or salvage company.
In order for you to make an informed decision, it’s important to understand the advantages and disadvantages of each option, as each situation has its own rare challenges.
Online and Offline Auctions
Online auctions are very popular these days, but there are things to consider before selling your goods on an online auction. Using an online auction site, such as eBay, can prove to be very time-consuming, especially if you have large quantities of merchandise. Instead of making the time of action quick and easy for you, by being able to find one buyer for the complete large quantity, you usually find yourself trying to manage hundreds of individual auctions, and processing hundreds of sales with individuals. Not only is this very difficult to keep track of, but it can take a long time. Plus, you will be paying fees on every individual sale, which will cut into your profit possible.
Another option is to hire an auctioneer to conduct an offline auction for you. While you might make a fair profit with this method, there are costs involved with auctions, and you don’t have any real guarantees or control over the selling prices. Auctions also often take a while to organize, and their success (or failure) is dependent upon a lot of factors, such as how many people attend the auction, and how well the auction was advertised in improvement.
Both online and offline auctions have another danger that some people don’t consider…the without of control as to who purchases your inventory. There is the chance, for example, that your excess inventory could be purchased by a competitor or other local merchant. This very inconvenient (and possibly embarrassing) situation could cause your company to have to deal with some serious branding issues.
Giving Away Your Products to Help Others
While helping others who are less fortunate by donating your products is a very altruistic thing to do, it’s important to remember that you won’t truly be getting any cash in return. However, if proven properly, you will be able to claim a tax deduction as a consequence of your generosity. This tax deduction will bring you some financial assistance, but it won’t be processed closest, and will represent only a small fraction of the value of your items. If you don’t truly need cash, you could go this route and at the minimum get some positive press for your company, by publicizing your charitable contribution. This is not the answer, of course, if you are looking to receive cash closest for your products.
A specialized Salvage or Liquidation Company
As you can see, auctions and charitable donations have their advantages, but they have many disadvantages in addition. Working with a specialized liquidation or salvage company can help you avoid the pitfalls, while nevertheless enjoying most of the advantages that the other methods provide in addition. Although a liquidation company may not give you as high a return for your merchandise as an auction, they will be able to remove the complete inventory at once, pay you cash upfront, and protect your inventories from re-entering your existing sales and dispensing channels. Also, by working with a liquidation company you can be more certain of meeting vital deadlines like exiting a warehouse before your lease is up, or getting certain inventories off your books before the accounting period is over. Usually, working with a reliable liquidation company is the most efficient option overall and by saving you time, energy, and additional resources you will usually get a higher end return in addition.