Excess Inventory on Amazon: What Should You Do With It?

Did you know that the estimated excess inventory for clothes in a single fashion season can reach $160 billion to $185 billion globally?

As an Amazon seller, you may at some point contemplate selling off your extra goods. Clearing inventory is a standard procedure in retail, but it can also be time-consuming and difficult.

Excess inventory in your Amazon inventory, regardless of whether you’re an FBM or FBA seller, will chew up your resources, hinder your cash flow, and have a significant impact on your bottom line development. The more time you keep your redundant supplies, the more money you’ll spend on storage. Business investments and overall earnings are hampered as a result.

There is no one-size-fits-all answer for Amazon merchants to liquidate excess inventory. Keep on reading to learn all about the different strategies you can apply to cut down on your excess amazon inventory.

The Basics of Managing Excess Inventory on Amazon: Amazon’s FBA Liquidations Program

To help FBA sellers recoup some of the value from their surplus inventory and reduce storage expenses, Amazon has introduced a new liquidation program for FBA.

Amazon delivers your product to wholesale liquidation businesses when you use this service to liquidate your inventory. A percentage of the average selling price you’ll earn back is between 5 percent and 10 percent, and you’ll be paid within two to three months after sending your goods. Assuming you can’t sell your extra inventory elsewhere, it’s preferable to have them thrown away or sent back to you since you don’t have a market for them.

Yet, keep in mind that you’ll want to nip¬†excess inventory on amazon in the bud from early on. You don’t want to deal with excess inventory frequently.¬†

Create Amazon Outlet Listings

In addition to Amazon.com, you may also sell your surplus inventory on Amazon Outlet to boost your sales and save storage costs. But, you’ll want to become familiar with their offerings before doing so. 

Among the offerings in this marketplace are:

  • Outlet Sales for products sold at discounted rates
  • Outlet Deals for promotional deals like Overstock Deals
  • It’s free of charge

In short, it’s worth a try as it won’t cost you a cent to set it up.

Join Amazon’s Lightning Deals

You will offer a Lightning Deal for a short period and in minimal quantities (also known as a flash sale). Listed on the “Today’s Deals” page, lightning deals are available for a maximum of six hours or until the item is sold out. The website is well geared for conversion. It might be a lucrative approach to get rid of your extra units.

If you look at the selling price, it is listed above a strikethrough price. Availability and expiration dates may be seen on this page, as well. Lightning Deals, like Amazon Outlet, have a set of requirements that merchants must complete before participating. Among them:

  • Your product must be eligible for Amazon Prime in all regions of the United States, including Puerto Rico if your Lightning Deals are to take place in the U.S.
  • the product must be in new condition
  • Your product has a sales history and a product review rating of 3 stars
  • If applicable, you must have enough stock for products with multiple variations
  • Your product must NOT be inappropriate, restricted, or offensive
  • Be compliant and follow Amazon’s Lightning Deal frequency policies
  • It should have a valid reference price and must be compliant with Amazon’s pricing policies

If your product does not meet Amazon’s pricing regulations, you will not be able to sell it on the site regardless, and not as part of Amazon’s Lightning Deals. 

Set Up an Amazon Disposal or Removal Order

Using this strategy to eliminate a complete listing is an excellent option for product revenues that aren’t enough to pay Amazon storage fees for sellers whose products are not selling. Also, it can be great for instances of sellers who believe they may receive a higher return on investment via alternative sales channels like eBay.

It’s important to remember that Amazon removal orders do not qualify as sales velocity. You may free up space and increase sales velocity by selling Amazon overstock merchandise through a flash sale or other online marketplaces that fulfill via Amazon instead. If you decide to go with the latter, you may be able to bump up your resupply limit on Amazon by doing so.

Send Excess Inventory to Liquidation Companies

Using liquidators is an excellent method to get rid of surplus inventory quickly. They buy various types of stock and then resale it at a much lower price, which is what liquidators do.

Although liquidation is the fastest-selling excess inventory, it is not the most lucrative. In most cases, a liquidator will acquire your goods at a discount. Fees for shipping your surplus stock to an excess stock liquidator are also considered. So, before selling your Amazon surplus goods to liquidators.

Market Your Products with an Emphasis on Inventory Management

An inventory-focused marketing approach aims to rethink inventory management. The two go hand in hand: inventory management with an eye toward marketing and marketing with an eye towards inventory management. It’s a great way to get everyone on the same page so that you can push both hot and cold items at the same time without running out of anything.

If your inventory and marketing managers can find out a way to bring them back into the game, even slow-moving items have the potential to be top sellers. If you have a lot of slow-moving goods in FBA, your inventory team may tell your marketing team about it. Using the inventory manager’s demand projections, the marketing team may devise a flash sale strategy, launch a PPC campaign, and construct a revenue-generating listing.

Sell Inventory as Soon as Possible: Simplified

When you sell your product quickly, you’ll free up space in your warehouse, free up funds, enhance cash flow, and raise your rating on that listing. We hope that our guide has shed some light on dealing with excess inventory, with minimal disturbance to your warehouse management. 

And, if you’re hungry for more logistics tips, you should check out our business section for all of our other explainers and guides.