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Surplus Stock

What is excess inventory?

In a large competition environment, especially when financing is increasingly difficult, firms must use all kinds of resources in the most efficient way. In particular, the materials and assets that have been stored in the warehouse for an extended period of time are surplus items. The technical description suggests that when the items are in the inventory more than 3 years without moving on the shelves, the material is called excess inventory.

Excess Inventory Classes

The excess stocks can be divided into 3 different categories in terms of commercial, return and management.

Unused valuable material 

Spare Parts, Special Building Materials

The materials in this category are particularly eligible for the overseas markets, light in weight but heavy in value, and the cost of the transport expenses are much lower than the price of the goods. They can be internationally identified by the brand name and manufacturer number. The fastest selling surplus goods are in this category due to the fast order confirmation and logistic convenience.

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Durable asset 

Work Machine, Equipment, Rig

Heavy duty machines, workshop equipment, and assets are in this category. The sale of equipment, especially in the last half of its life, has a different process than the 1st category  including unused valuable materials such as spare parts and special building materials. In the first category, the sale is easily completed after product and price confirmation. On the contrary the sales in second category consist of many phases such as equipment control, price negotiations, determination of payment method, logistic and contract. The increase of the number of buyers provides a bargain advantage for the seller company even long sales negotiations.

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Bulk Material And The End Of Life Assets 

The items that are lighter in value but heavy in weight, completed useful lifetime, or need to undergo heavy maintenance fall into this category such as  electronic equipment older than 5 years, lighting appliqués, ventilation ducts or decoration assets. It is possible to sell such items with wholesale and specialized companies that trade in this category. On the other hand, the commercial gain of these products lower than category the second category.

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