Insights

Cash In on Excess Inventory

If the same brokers or wholesale b2b buyers are buying your inventory year-on-year, you’re likely giving away margin for the sake of convenience. By adopting a proactive asset remarketing process, you’ll learn how to generate new and improved sources of income that will directly impact your business.

As a Supply Chain Executive, you may well have explored your forward and reverse supply chains for cost reductions in order to free-up working capital and increase cash flow. However, did you know there remains a largely untapped cash‐generation machine for your company? It’s called your ‘at-risk inventory’.

In most companies, 20% of all inventory falls into an “At Risk” category during one or more stages of the product lifecycle. Your inventory management team probably already has a process in place for liquidating excess and returns inventory, but this does not mean you are generating as much cash as you could. Product profitability peaks early then erodes as products age, and this is something that can be recognized across all stages of the product life cycle due to mismatches in supply/demand, slow‐moving, end-of-life and obsolete products, consumer returns and refurbished inventory.

However, progressive remarketing can restore profitability if managed intelligently across all stages of the product lifecycle. By adopting a proactive asset remarketing process, you can generate cash while reducing warehousing expenses, standard cost revisions and other carrying costs associated with at‐risk inventory.

Whatever the condition, whatever the location, there is a vibrant secondary market for consumer electronics and wireless handset devices and accessories. You may not realize, but 35% of all global handset sales in 2012 were made via the secondary market.

By using FreeFlow’s online private marketplace platform, you get to control who is allowed to buy and where they can sell, then share in the benefits that emerging markets bring to financial recovery. You will discover how remarketing your products earlier in the lifecycle can yield the most impact, while using process management tools that offer financial control, transparency and performance metrics.

Why deny yourself the increase in recovery that comes from buyers having to compete for your products? By using the income that FreeFlow’s secondary market auctioning platform provides, you can not only offset your inventory reserves but create a positive, direct impact on your profit margins.

 

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