How to Run a Going-Out-of-Business Sale for Your Home Business
Decide if A Going-Out-of-Business Sale is Right for You
This is especially true for people who have perishable or seasonal items, as well as people who may be facing an oversaturated market such as direct sales consultants. If you put off your going-out-of-business sale you are risking missing out on the best possible outcome of potentially making something back to cover your expenses instead of having a massive discard once things expire.
Think carefully about if a going-out-of-business sale makes sense for you instead of possibly selling slowly over time. For example, if you sell silver jewelry in timeless designs you may find that waiting it out is the best option for you, while if you have a massive amount of fidget spinners you may struggle to sell for cents on the dollar of what you paid. Even if your inventory will still be usable in a year, you must consider if it will dramatically decrease in value as trends change, expiring in a metaphoric sense instead of due to decay.
Have Realistic Expectations
Having realistic expectations is crucial for any business, but especially true when you are trying to go out of business. Holding your inventory until it is completely worthless is likely counter productive to your goals and some of your inventory may already be worth less than you paid. When you are trying to go out of business, having a profit would be ideal, but I encourage small and home businesses to focus on minimizing loss. Have realistic expectations on what you can sell your inventory for and the actual value. There is no shame in breaking even by selling items for much lower profit than originally planned and it is much better than taking a complete loss on these items.
How to Price Your Items
Pricing can vary greatly based on what you sell. I suggest starting by selecting items that you believe you can sell more easily, then considering items that will be a harder sell. Some items may sell at a loss, but this is better that having to absorb the entire cost.
For example, if you paid $10 per t-shirt and originally planned to sell them for $20 each to your customers, you may try to sell designs that are more in demand for $15 and low demand designs for $5. This way, while you are not making a profit, you are not losing money. If you tried to sell both shirts for $15 and one did not sell, you would be losing $5 and still have an unwanted shirt.
If you can make additional profit, it is fantastic for you and of course you should, but remember that selling for something is likely better than having unsold merchandise.
Where to Sell
Often there are GOOB groups on Facebook, though they are often scouted by bargain shoppers seeking something for next to nothing. While Facebook is a fine platform for sales, I do not suggest GOOB groups as they will offer you the lowest amount possible.
I suggest selling through Ebay, Etsy, Instagram, and Facebook. If you sell clothing I also suggest Poshmark and Tradesy. Find the sales channel that suits your style of selling and merchandise. If your store has a website your own website is also a fantastic option, though it may not be ideal if you are struggling to generate traffic.
If you are able to sell in person, this option also has potential, though I would not recommend making an investment to do so. Spending hundreds on a spot at a marketplace or festival will likely just put you farther into the red. If you are able to find a low- or no-cost location, this may be a great option, as customers do prefer to touch and see sale items. People may be skeptical of the reduced pricing and suspect that it means reduced quality, and an in-person sale eliminates this fear.
Should I Bundle Products?
Bundles at a heavy discount are a popular way for home businesses to clear inventory. Bundling can provide value to customers as well as reducing the risk of unsold merchandise for vendors. Bundles tend to do well on online marketplaces, but only when the discount makes sense for consumers. Most customers are not interested in a set of the vendors choosing for the same pricing as the items individually. There must be some incentive to choose bundled items, such as a larger discount than purchasing individually.
If you sell clothing consider bundling the same item in different colors as well as pairing various items to form an outfit. Often customers have a favorite item and will want to stock up before you close your doors. This can be an opportunity to sell a lot of inventory at a reasonable discount, including some things that would struggle to sell otherwise. For example, someone who adores your brands jeans may want several and be willing to buy a color that they typically wouldn't consider because they are both getting a good deal and adding to their collection.
Going out of business can be a difficult thing, regardless of the reason that you are going out of business. Whether you plan on taking ten months or ten days to go out of business it can be a stressful process. It is important to remember that this time does not last forever and this process is generally necessary as well as being a common decision. Many businesses go out of business and many have sales to clear inventory. The process may be stressful today, but it will be over before you know it, and you will be able to focus on other pursuits.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.