Tips to Get Rid of Slow-Moving Stock & Develop Supplier Relationship in Ecommerce

In e-commerce, building long-lasting and reliable supplier relationships brings many opportunities, such as discounted prices, better stock availability, and sometimes even buybacks. Therefore, any e-commerce manager should always aim for improvements in her/his company’s supplier relationships to realize all these potential opportunities.

Here, we are focussing on the most common model of e-commerce, where merchants basically purchase products from various wholesalers (suppliers) and resell them to consumers by adding the desired margins on top of the wholesale price. In this model, there is the unavoidable dependence of merchants on the suppliers — either the manufacturer of the product or the distributor — regarding the payment terms, costs, or availability.

1. Know that you are not the only one: In today’s wildly competitive e-commerce market, there are tons of other mid or small-sized retailers supplying the same product assortments from the very same suppliers. In short, your most crucial business contacts are also crucial for your competitors.
2. Pay on time: Paying on time will have a huge impact on your relationship with suppliers. No one likes late players, even your friends. In e-commerce, consider your suppliers as your best friends, and work on maintaining the image in your suppliers’ minds that you’ll always pay on time.

Want to learn more about how to build supplier relationships? Read our blog post: Ecommerce Supplier Relationship Tips.

Let’s say that you have built a good supplier relationship. But what if you have slow-moving stock?

Slow-stock means what constitutes “slow-moving” varies from company to company. However, you can classify slow-moving inventory as items less than 6–8 months of demand in the preceding 10–12 months.

Consequently, the slow-moving items within the goods inventory, such as grocery items, can’t be classified as slow-moving in other categories. On the other hand, some companies are in a maintenance, repair, and operations environment where inventory items, such as spare parts, can be classified as slow-moving items.

Here are the key steps for getting rid of them:

Control the Stock in the First Place: Inventory management saves you money and enables you to satisfy your customers’ needs. It allows for successful cost control of your business operations. You can manage the supply chain adequately when you know what you have in your warehouse and the number of fast-movers and slow-movers.

Review Movement and Stock Profiles: Before you eliminate the weakest performers at the end of the season, it is crucial to identify them. When you regularly monitor movement and inventory profiles that sort all stock-keeping units by inventory profiles and sales volume, you can sort them by stock categories.

To learn more, read our blog article: How to Get Rid of Slow-Moving Stock at the end of Season