What to look out for when selling your surplus stock

EURO OVERSTOCK B.V. believes the main thing for A-brand suppliers to take into account when selling surplus stock is to make sure it never impacts on their regular sales. We base this on our findings that the total value of leftover stock often barely amounts to one percent of a company’s overall sales figures.

If you are of the same view, we advise you to consider imposing sales restrictions for selling your surplus items. Such restrictions may take the form of wording, sales channels or regions.

Sales to regular customers

We know from experience that you will get the biggest return when selling your surplus stock if you offer it to your regular customers. Your regular customers are often very good at finding a home for large volumes of surplus stock for a good price. There’s every chance you can persuade your regular customers to order in more by offering a discount.

However, if you choose this option, you should be aware of a number of risks:

bullet You have purposefully opted for a hard relaunch and you want all your customers to re-stock their shelves with the new products. It may be confusing for consumers as well as your customers if the old and new products are delivered at the same time;

bullet Your customer may then use the discount to reduce the regular price of your product;

bullet Your customer may not be persuaded or is not obliged to schedule a(n extra) campaign. If this is the case, the sales of your surplus items will not lead to consumers buying more of your product. Apart from the problem of forward-buying, there is also a risk that your surplus stock problems will become cyclical.

Other options

It may be that you cannot reach a solution with your regular customers about selling your surplus items. Alternatively, you may purposefully choose not to offer your surplus stock via your usual sales channels. And this will probably be for one of the reasons set out above.

In this scenario, you’ll be obliged to start exploring other options. If you look for solutions for selling your surplus stock outside the usual sales channels, you should give some thought to the following restrictions:

Can your surplus items be mentioned in the buyer’s literature?

Buyers are often prepared to pay more for excess stock if your A brand can be mentioned in their literature.

Which sales channels do you want to sell to?

Do you want to sell your surplus stock in specific sales channels or do you want to exclude certain sales channels? Some manufacturers want to prevent their surplus stock from turning up on the shelves of supermarkets, while for others this is exactly where they want them to be sold (for example to meet a target market share).

Where do you want your surplus stock to be sold?

Do you want your surplus items to be sold in your own country or abroad? From a QA perspective, manufacturers usually prefer their surplus items to be sold in their own country. This may be because of the language and telephone numbers on the packaging, or perhaps requirements on the declaration of ingredients or allergies.