Dead Stock
Also known as: Obsolete inventory
Dead stock is inventory that can no longer be sold or used, tying up capital and warehouse space with little prospect of return.
Dead stock builds up from over-ordering, poor forecasting, discontinued products, changed specifications or items past their usable life. It occupies storage, consumes carrying cost and represents cash that cannot be recovered at full value. Left unmanaged, it quietly erodes working capital and clutters warehouses.
Reducing dead stock starts with visibility — identifying slow-moving and obsolete items through stock-turnover and ABC analysis — then acting through markdowns, returns to suppliers, redeployment or write-off. Preventing it requires better demand forecasting, disciplined reorder policies and SKU rationalisation, so buying stays aligned with genuine need rather than accumulating unusable inventory.
Frequently asked questions
- What is dead stock?
- Dead stock is inventory that can no longer be sold or used, tying up capital and warehouse space with little prospect of recovering its value.
- How can dead stock be reduced?
- Identify slow-moving and obsolete items through stock-turnover and ABC analysis, then clear them via markdowns, returns, redeployment or write-off, and prevent recurrence with better forecasting and reorder discipline.
Related terms
Inventory Management
Inventory management is the practice of ordering, storing, tracking and controlling stock so that the right items are available at the right time without tying up excess capital.
Read definitionCarrying Cost
Carrying cost is the total cost of holding inventory over a period, including storage, capital, insurance, handling and the risk of obsolescence.
Read definitionStock Turnover
Stock turnover is a ratio that measures how many times inventory is sold and replaced over a period, indicating how efficiently stock is used.
Read definitionDemand Forecasting
Demand forecasting is the practice of estimating future demand for goods so that purchasing, inventory and supply can be planned accordingly.
Read definitionExplore related across the knowledge graph
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