Have Excess Inventory? Here’s How Amazon Outlet Can Help

Effective inventory management is a precise practice that takes time and efficient workflows to perfect. To maximize the performance of your in-stock SKUs and avoid unnecessary storage fees, maintaining between 30 and 60 days of inventory on hand is a good rule of thumb for inventory management. Amazon defines excess inventory as follows:

• If at least one unit of inventory is more than 90 days old
• If the product has over 90 days of supply, and
• The cost of holding your inventory without taking any action is more than the cost of taking action (such as lowering your prices to increase sell-through or removing surplus inventory)

Amazon bases estimated excess inventory on product demand and your costs (such as fees and unit costs) and then estimates the level of inventory that can provide the highest ROI for your business.

Amazon’s latest move in inventory optimization is the Amazon Outlet beta program. In a dedicated landing page — amazon.com/outlet — Amazon has compiled overstock deals, inventory closeouts, and markdowns in one place for consumers to bargain shop. To participate in the program, you need to offer Outlet deals on qualified overstock ASINs.

The product offers that qualify for Outlet need to demonstrate either 30% off the previous day’s lowest Buy Box price or 30% off the average Buy Box price from the previous 30 days. The Outlet is categorized for ease of use and broken up into groups such as Overstock Deals, Best Sellers, and Super Discounts.