How to identify and quantify overstock

February 7, 2024

Feb 7, 2024

Expert Insights

Market conditions have dramatically changed over the course of 2022. Unfortunately for many brands and retailers, this implies a dramatic drop in demand that wasn’t anticipated at the time of ordering goods to sell for the year. The consequence: a higher likelihood of overstock.

Even during “normal circumstances”, keeping the right stock levels is tricky. If you understock you run the risk of losing out on sales. On the flip side, if you overstock you tie up cash in excess inventory. To get the balance right you need to take some calculated bets. In this article, we take a closer look at the implications of overstock, how to identify and quantify it.

This guide is part 1 of 2. In part two, we outline how to address overstock.

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