Aged inventory can be the death of your retail. No customer wants to see the same items every time that they come into your store.
If this is the case, they more than likely will not come as often or not come at all. Pawn shops are meant to have variety and create a sense of excitement when you come in. Never knowing what might be around the corner on that shelf or in that glass case. Today’s broker has many more options than the broker of old did to rid themselves of this “killer”, but the first order of business is to identify and then attack.
- Run an aged inventory report (I suggest anything over 6 months old) once a month and decide how you are going to get rid of it i.e. eBay, Facebook, clearance section, etc.
- Find the items and follow through! Don’t let life get in the way and forget. Get these items out of the store no matter the cost. It doesn’t matter what you paid for something; it only matters what someone will pay for it. Do your research, find the most lucrative way for you to sell, and get on it fast.
- Be sure to also identify your “special items”. Items such as diamonds, collectibles, firearms, and such. These items should only be handled by you or someone you trust to make high level decisions. Items like these will probably take more time to find an avenue to sell and may need to be sent to an auction house, wholesaler, etc.
If you have employees, have fun with this and explain to them why this needs to be a focus monthly. I once brought in a birthday cake for a watch that one of my managers promised me would be sold months prior. We celebrated that watches 1 year birthday that day! The employees had a laugh, enjoyed some cake, and the manager made sure to not forget about aged inventory again. She also sold the watch that day as well.
Here are a few ways to get these items sold if you decide that online is not your best option:
- Create a clearance section. Balloons, yellow tape, signage…whatever it takes to bring a customers attention to these items.
- Put a table in a high traffic area of the store and place the aged items on it.
- Have a yard sale or a sidewalk sale.
- Donate the items. Sometimes this works better for the books and can really help at tax time.
- Bring in an auctioneer and have an after hours sale.
There are many other ways to move the product as well. Get creative and get your team involved with the process.
All this is great, but if you don’t price things correctly to sell, it is all for naught. One of the best things that I’ve seen is a staggered sale i.e.
- 1st week – 25% off
- 2nd week – 50% off
- 3rd week – 75% off
- There shouldn’t be a need for a 4th week. If they don’t buy at 75% off, then it’s time to throw away or donate.
If you do this consistently at the beginning of every month, your customers will respond by showing up in droves to see if an item that they’ve had their eye on has been marked down.
Please remember, your cash drawer does not understand gross profits, it understands DOLLARS. At this point it doesn’t matter if you make or lose money on paper, it matters that you’re putting money in the drawer to help the business run.