In my last column, we developed a definition of dead inventory. I promised you then that this time we would discuss how to get rid of dead inventory in a manner that didn’t involve giving it away to the local thrift shop or carrying it to a flea market. So, here are four easy ways to dispose of dead inventory. These methods will move merchandise and leave you with some cash, if not profits.
Join a Barter Exchange
Here’s how a barter exchange works: You list the inventory you want to move with a barter exchange. When an item sells, you don’t get cash; you get electronic “credits” with the exchange you can use to purchase items that are listed for sale in the exchange marketplace.
Buyers in a barter exchange are always looking for ways to spend their credits, and your antiques and collectibles will provide them with a good value. For years, I moved my slow merchandise through a barter exchange in the Washington, D.C., area. In return, I bought items that I needed to run my business that I would have paid cash for elsewhere: office supplies, printing and payroll services. I made my usual markups on the merchandise that I sold, so there was no loss involved. I also conserved my cash by using barter credits to make purchases. One of the top barter exchanges, IMS Barter even has a category for Antiques & Collectibles in their online marketplace. Other exchanges can be found by Googling “barter exchange.”
Think Like an Auctioneer
I know that there is some “bad blood” between retailers and auctioneers. But everyone agrees that no one moves merchandise faster or better than an auctioneer, and retailers can benefit by following their lead. Auction houses don’t have dead inventory problems. Auction houses get paid on everything, even items that don’t sell. In most cases, consigned items that don’t meet their reserve prices are returned to the consignees and a minimum fee is charged for presenting the item at auction.
Retailers can hold an annual or bi-annual auction to dispose of dead inventory. I hear the moans and groans already: “But auctioneer fees are too high!” So don’t pay any fees. Hold your own auctions. As long as you own the merchandise being auctioned, you don’t need a license to auction in any state in the U.S. There are three ways that even a shy dealer with no public speaking skills can hold an effective auction and pay no per-item selling fees:
Have a one-day silent auction in your store.
Have a live auction and hire a licensed auctioneer to call bids for you (by the hour or by the evening). In my area (Virginia/North Carolina) I can hire a championship bid caller for an evening for $300 to $500.
Add an auction page to your website using a WordPress add-on like WP-Auctions rather than pay fees to eBay. Ask your webmaster about setting up a sub-domain for your site and loading WP-Auctions.
If you don’t have enough dead inventory of your own to justify a live auction, consider getting an “auction house” license (if your state requires one) and arrange to add some estate consignments to your auction mix. It’s a lot of work to set up and execute an auction, but you will find that it gives your business a welcome cash-flow boost, especially if you add consignments to the mix. I’m told by dealers who do an annual auction that they have a regular group of estate-administrator attorneys who call to consign entire estates to their auctions.
Hold a Flea Market Dealer Day
Setting up at a flea market is a pain in the back: Loading your inventory, tables, tent, cooler, setting everything up, working all day in the hot sun (or cold rain) and then packing it all up again at the end of the day is back-breaking work.
Since a fair number of your flea market buyers are other dealers, why not just invite them to your store for a private sale or auction? This can be turned into a social event as an after-hours meet-and-greet with refreshments served and a silent auction.
One successful approach is to display your entire dead inventory together and then take bids on all of it together as one lot. That way, you get rid of everything to one buyer while simultaneously holding a nice networking event and making some connections.
Value Added Approach
Another approach to moving dead inventory is to pair a dead inventory item with a compatible product and sell it as a grouping. This method works by combining “dead plus new” inventory, and also by combining “dead plus dead” inventory. For example, match a curio cabinet with some glass or figurines; match a jewelry box with some costume jewelry; match an antique doll carriage with a doll or blankets; match a table with a lamp; a dresser with a mirror or picture frame; an Atari with a couple of games.
If you find yourself with too many of a particular item (baseball cards or marbles, for example) sell “X” for the price of one.
Engage Your Staff
Give your staff the authority to wheel-and-deal where dead inventory is concerned – with no repercussions from you. Customers are always looking for a deal. When the time comes to negotiate a selling price on your prime merchandise, a wise owner’s first move is to “throw in” a dead inventory item to clinch a sale rather than drop the price on a valuable piece. Alternately, pay your salesperson a “spiff” (bonus) for selling selected inventory items. You’ll motivate your employees to sell the items and move them out of your store.
This isn’t a be-all-and-end-all list; these are a few ideas presented to me by dealers that I believe have merit. I’d love to hear your thoughts, because some dealers are having a real problem with dead inventory and your advice is welcome. If you’ve tried something and it worked, or tried something and it failed (even one of the above ideas), we would like to know. Share your thoughts as a letter to the editor and reference this column.