What Slow-Moving Inventory Is and What Causes It

Every business will encounter inventory issues at one point or another. One of these common concerns deals with slow-moving inventory. If you’ve never heard of it, keep reading to discover what slow-moving inventory is and what causes it.

What Is Slow-Moving Inventory?

Almost every business will deal with slow-moving inventory at some point, so it’s important to know how to identify it. Slow-moving inventory, also known as SMI, is any products or stock keeping units (SKUs) that haven’t been purchased or shipped in a certain amount of time. This amount of time could be different from business to business. You can usually classify products with a bad turn rate as slow-moving.

What Causes Slow-Moving Inventory?

Several factors may cause once-popular products to become slow-moving inventory. In most cases, the factors behind slow-moving inventory are out of your business’ control. Market trends may slow down, and products that were once trending in a certain demographic might suddenly drop out of popularity. Sometimes, competitors might steal your business by selling the same products at a lower price. Many businesses with a surplus of slow-moving inventory may have originally purchased it in bulk to save money on unit costs or shipping. Whatever the reason, slow-moving products are a concern for many businesses, especially when products have expiration dates.

Solutions for Slow-Moving Inventory

To sell slow-moving products more efficiently, rethink your marketing strategies. You might not be pushing slow-moving products as hard as you once were, but customers won’t know about your offers unless you spread the word. One creative way to sell slow-moving inventory is to create product bundles. This involves bundling multiple products at a discount. Product bundles are a smart way to sell multiple products in one purchase, especially stubborn, slow-moving ones.

Now that you understand what slow-moving inventory is and what causes it, you can identify these products in your own warehouse. Every business will encounter these roadblocks at some point, so it’s important to know how to navigate them with these tips.