An excess Amazon inventory can be challenging. It holds your cash, takes up storage fees, and affects your overall business.

You’re dealing with unsold products, and every day they sit in Amazon’s warehouse, your costs go up. But the best thing? There are effective ways to clear it out fast without taking huge losses.

You’re about to learn how to liquidate Amazon inventory with the least amount of hassle. Keep reading till the end to save on storage fees and get some of your capital back.

Top 7 Ways To Liquidate Excess Amazon Inventory

1. Use Amazon Outlet Deals

   
   Amazon Outlet is a great option if your products have strong sales history and a good star rating (3.5+). This program is designed for items that have been marked as excess inventory by Amazon based on past sales data.
   • How It Works:
     • Check your Seller Central account. Go to Manage Inventory then FBA Inventory.
     • Look at the “Estimated Excess Units” column. If Amazon identifies your products as excess, you’ll see a Create Outlet Deal option.
     • Enroll your product with a mandatory discount of 30-35%. This discount attracts bargain hunters.
   • Pros:
     • Fast clearance of bulk inventory.
     • High visibility on Amazon Outlet, which has dedicated traffic.
     • No extra marketing costs.
   • Cons:
     • Requires a strong sales history and good customer ratings.
     • The discount cuts into your margins.
   • Best For: Sellers with high-quality products stuck in inventory that meet Amazon’s eligibility requirements.
   • Pro Tip: With PayGlocal’s multi-currency support, you can easily receive payments from international customers.

   Now, if your product isn’t eligible for Outlet Deals or you need a simpler approach, Amazon’s built-in liquidation program might be the next best option.

2. Try Amazon’s Built-In Liquidation Program

   
   If your product isn’t eligible for Outlet Deals or you need a hassle-free option, Amazon’s built-in liquidation program can help. This service allows you to sell directly to Amazon’s network of liquidators.
   • How It Works:
     • Eligible products can be enrolled directly through Manage Inventory.
     • Amazon handles everything from finding buyers to processing the sale.
     • The process can take up to 90 days (30 days to find a buyer, 60 days for payment).
   • Cost and Returns:
     • Fees include a 15% referral fee plus an Amazon FBA fee based on weight.
     • You typically recover 5-10% of the item’s selling price.
   • Pros:
     • Stops monthly storage fees immediately.
     • No need to handle logistics yourself.
     • Consistent and simple process.
   • Cons:
     • Low recovery value (around 5.5% on average).
     • Not all products are eligible.
   • Best For: Sellers looking for a no-fuss liquidation option with minimal effort.

   For sellers who can afford to lower their margins, offering discounts and promotions can be an effective way to attract buyers and speed up sales.

3. Offer Deep Discounts & Promotions

   
   Sometimes the fastest way to clear out inventory is through aggressive price cuts. By running promotions or offering coupons, you can quickly attract buyers who are looking for a deal.
   • How to Do It:
     • Set up Prime Exclusive Discounts or use the Coupon tool in Seller Central.
     • Offer at least a 30% discount. This makes the offer attractive without simply dropping the base price.
     • Consider using these discounts during high-traffic periods like Amazon Prime Day.
   • Pros:
     • Increases your chances of winning the Buy Box.
     • Boosts sales velocity quickly.
     • Drives full-price sales without relying solely on liquidation.
   • Cons:
     • May lead to selling at a loss if the discount is too steep.
     • Requires active monitoring and adjustment.
   • Best For: Sellers who can afford to offer discounts and need to sell products quickly.

   If you’re looking for higher returns and are open to working outside Amazon, partnering with third-party liquidators could provide better value for your excess stock.

4. Partner With Third-Party Liquidators

   
   If Amazon’s built-in options aren’t giving you the returns you need, third-party liquidators can offer a better deal. These companies buy your excess stock in bulk and resell it through various channels.
   • How It Works:
     • You ship your inventory to a liquidator’s warehouse.
     • They inspect, repackage, and resell the items.
     • Typical recovery rates are between 15-30% of the original product value.
   • Pros:
     • Higher potential recovery than Amazon’s liquidation program.
     • Offers more control over the liquidation process.
     • Can handle a wide variety of products, including used items.
   • Cons:
     • Takes more time to set up.
     • Fees can be high, depending on the liquidator.
   • Best For: Sellers looking for higher returns and willing to manage the extra logistics.
   • Pro Tip: With PayGlocal’s Global Payment Methods, you can receive your funds faster, and with fewer currency conversion issues.

   Now sometimes, a quicker sale is more important than maintaining a high margin. This is where huge price drops come into play.

5. Huge Price Drops

   
   When you’re dealing with excess inventory that just won’t move, huge price drops might be your best choice. This method focuses on getting your capital back fast, even if it means taking a loss.
   • How to Execute:
     • Start discounting after 90 days of slow sales.
     • Gradually reduce the price by 10-20% every few weeks until the product starts to sell.
     • Use tools like Keepa to track competitor pricing and ensure your product is competitively priced.
   • Pros:
     • Clears out inventory quickly.
     • Helps you win the Buy Box by offering the lowest price.
     • Easy to implement with minimal effort.
   • Cons:
     • High risk of selling at a significant loss.
     • Can hurt your brand’s perceived value if done frequently.
   • Best For: Sellers focused on cash flow and willing to take a small loss to free up capital.

   If you have products that are slightly damaged or returned, refurbishing them can be a way to regain some value while offering buyers a trusted, certified product.

6. Utilize Amazon Refurbishment Program

   
   If you have returns or slightly damaged products, the Amazon Refurbishment program can help. Amazon will repair, repackage, and resell these items as “Certified Refurbished.”
   • How It Works:
     • Enroll eligible products directly in Seller Central.
     • Amazon handles the refurbishment process.
     • Refurbished items are listed as “Certified Refurbished,” which can attract buyers looking for deals.
   • Pros:
     • Gives products a second chance at selling.
     • Increases trust with the “Certified Refurbished” label.
     • Avoids disposal fees for returned items.
   • Cons:
     • Only suitable for larger, higher-value items.
     • Risk of multiple returns, leading to negative feedback.
     • Not recommended for small or low-value products.
   • Best For: Sellers with high-ticket items like electronics or appliances.

   If your products aren’t selling despite all efforts, a removal order might be your final option. It helps clear out unsellable stock while avoiding additional storage fees.

7. Removal Orders For Donations Or Disposal

   
   If your products aren’t selling and you can’t find a buyer, a removal order is the last resort. This option allows you to either donate the inventory or have it disposed of.
   • How to Use Removal Orders:
     • Go to Seller Central and initiate a Removal Order.
     • Choose between donation or disposal.
     • Be prepared to cover the removal fees, which range from 25 cents to $1 per unit, depending on size and weight.
   • Pros:
     • Clears out inventory completely.
     • Stops storage fees immediately.
     • Donations can offer tax benefits, depending on the region.
   • Cons:
     • Involves a disposal fee, adding to your costs.
     • Takes time (up to 2 months for full processing).
   • Best For: Sellers who can’t recover value through other methods and want to avoid ongoing storage costs.

Also Read: How To Sell And Ship Products Internationally Using Amazon Global

Knowing the basics of inventory liquidation will help you make informed decisions as you explore different ways to move excess stock.

What Is Amazon Inventory Liquidation?

Amazon inventory liquidation involves selling off excess, unsold, or slow-moving products at reduced prices. This process is critical for businesses that use Fulfilled by Amazon (FBA) services because Amazon charges high storage fees for items held for long periods. Liquidating inventory helps you recover some of your initial investment rather than letting stock collect dust and rack up costs.

You might liquidate products for several reasons. Maybe your sales projections were off, and the product isn’t moving as expected. Perhaps a competitor launched a similar product at a lower price point, or market trends changed suddenly. Regardless of the reason, liquidation lets you clear out stock quickly, free up cash flow, and avoid additional storage charges.

For example, if you launched a seasonal product like holiday-themed decor, it’s critical to sell it before the season ends. Holding onto such products will not only increase your fees but also reduce their market value, making liquidation a smart move to recover at least part of your investment.

Now that you know what inventory liquidation involves, let's look at why you might need to liquidate your Amazon inventory in the first place.

Why Liquidate Amazon Inventory?

There are several strong reasons to liquidate Amazon inventory rather than holding onto it and hoping for a sale. The main goal is to cut your losses early and reinvest the recovered capital into better-selling products.

1. To Avoid Long-Term Storage Fees

   Amazon charges monthly storage fees for all FBA products, but after 180 days, these fees double. If your product has been sitting unsold for over six months, it’s costing you significantly more to store. By liquidating, you can immediately stop these fees and reduce overall costs.

2. To Free Up Cash Flow

   Inventory sitting in Amazon’s warehouse ties up your working capital. This cash could be better used to invest in new products, marketing, or scaling up your operations. Liquidation offers a way to get your money back sooner so you can reinvest it.

   Also Read: Understanding Payment Transaction Processing And Types

3. To Clear Out Seasonal Or Obsolete Products

   Certain products have a limited selling period, like Halloween decorations or tech gadgets tied to a specific year. Holding onto these items beyond their season or relevance reduces their value dramatically. Liquidation helps you sell these products before they lose all value.

   Liquidating inventory can be a good decision, but it’s not always straightforward. Here are some factors to consider before moving forward.

What To Consider Before Liquidating Amazon Inventory?

Liquidating inventory isn’t a decision to take lightly. It’s important to evaluate several key factors to determine if liquidation is the right move for your business.

1. Assess Your Product’s Sales History

   Review the product’s performance over the past few months. Check its sales velocity and how often it appears in the Buy Box. A product with a poor sales history and declining demand may be better off liquidated rather than waiting for an unlikely uptick in interest.

   For instance, let’s say you launched a new kitchen gadget that initially sold well but has slowed down significantly over the past 60 days. The reviews are mixed, and competitors are offering similar products at lower prices. In this case, it may be smarter to liquidate now instead of hoping for a turnaround.

2. Evaluate The Product’s Condition

   The condition of your inventory impacts its liquidation value. New, unopened items will fetch better prices compared to used or returned products.

   If you have a mix of new and used items, consider different liquidation strategies for each category. For slightly damaged items, Amazon’s refurbishment program might be an option.

   For example, let’s say you have 300 units of a new electronic item and 50 units that were returned. The new units can be liquidated directly through Amazon’s program, while the returned ones might benefit from refurbishment before reselling, increasing their value.

3. Calculate Total Costs vs. Recovery Value

   Determine the costs you’re currently incurring, including storage fees, potential removal costs, and the lost opportunity of holding onto slow-moving stock.

   Compare this against the expected recovery value from liquidating. If the liquidation return covers more than your carrying costs, it’s usually a good decision.

   For example, let’s suppose you have $10,000 worth of inventory that hasn’t moved in three months, with monthly storage fees of $500. If you continue storing for another three months, that’s $1,500 in fees.

   If liquidation can recover $4,000, it’s better to take that route instead of incurring more costs and risking further value decline.

4. Consider The Impact On Brand Perception

   Liquidating products at deep discounts can sometimes impact your brand’s perceived value, especially if customers become accustomed to finding your products at clearance prices.

   Be strategic about which products you choose to liquidate, and avoid discounting items that are core to your brand’s image.

   For instance, let’s say your main product line consists of premium skincare items. Liquidating excess stock at a deep discount may hurt your brand’s reputation for quality.

   In this case, consider other options like rebranding the discounted items or offering them in bundles rather than listing them as discounted individual products.

5. Plan the Timing of Liquidation

   Timing matters when liquidating inventory. Avoid slow sales periods like January when many customers cut back on spending.

   Instead, plan liquidation efforts around major sales events like Prime Day or the holiday season when traffic is high, and buyers are actively looking for deals.

With so many options for liquidation, choosing the right method can be tricky. Here’s how to decide based on your unique needs and product type.

How To Choose The Best Amazon Inventory Liquidation Method?

Picking the right liquidation strategy depends on your specific situation. If your product is high-quality but stuck due to market competition, Amazon Outlet Deals can help tap into bargain hunters without the hassle of third-party arrangements. For items nearing expiration or with little demand, the Amazon Liquidation Program offers a hands-off approach, though returns are typically low.

If speed is a priority and you need immediate cash flow, deep discounts and promotions will attract quick buyers. This strategy works well during sales events or if you’re trying to clear out seasonal items. Meanwhile, aggressive price drops can help you compete for the Buy Box but may lower your brand’s perceived value.

For higher-value products like electronics, Amazon Refurbishment adds a certified label, making them more attractive to buyers. However, avoid this method for low-cost items, as it can lead to repeated returns and customer complaints.

Finally, if nothing else works, consider removal orders for donation. It’s a last resort, but it stops ongoing storage fees and may offer tax benefits.

Now, liquidation isn’t the only way to handle slow-moving inventory. Here are some additional strategies that will help you manage excess inventory without huge losses.

5 Best Alternative Strategies To Inventory Management

1. Diversify Sales Channels

   If your product isn’t moving on Amazon, try selling it on other platforms like eBay, Walmart Marketplace, or your own ecommerce site. This expands your reach and diversifies your sales efforts.

   For example, you might have a surplus of kitchen gadgets that aren’t performing well on Amazon. Listing them on eBay or Etsy could help you reach a different audience that may be more interested in niche or discounted items.

2. Create Bundles Or Kits

   Bundling slow-moving products with popular ones can help move inventory faster. This strategy increases the perceived value for customers and clears out stock without heavy discounting.

   For instance, if you have excess stock of a specific type of fitness accessory, bundle it with a popular product. This approach adds value for customers and helps move less popular items.

3. Leverage Subscription Models

   Consider offering your excess products as part of a subscription box or loyalty program. Customers who receive recurring shipments are often willing to try new products, especially if they feel they’re getting a good deal.

   For example, if you have skincare products that aren’t selling well individually, including them as samples or bonus items in a monthly subscription box can help you offload inventory while building brand loyalty.

4. Run Targeted Promotions

   Instead of slashing prices across the board, run targeted promotions using email marketing, social media, or Amazon's advertising tools. This way, you can attract specific segments of your audience who are more likely to purchase discounted items.

   Use Amazon’s Sponsored Products ads to promote your discounted items to shoppers who have already shown interest in similar products. This strategy increases your chances of selling without devaluing your entire product line.

5. Offer Products To Influencers Or As Corporate Gifts

   Rather than liquidating for low returns, consider giving your excess products to influencers or using them as corporate gifts. This not only helps clear out inventory but also boosts brand awareness.

   For example, a surplus of tech gadgets could be sent to influencers in your niche. They can review the product, giving you exposure and potentially driving more sales in the future.

Also Read: A Complete Guide To International Transaction Fees

Final Thoughts

Excess Amazon inventory can be a costly problem, but with the right approach, you can cut your losses and recover some capital. Start with options like Outlet Deals and Amazon’s liquidation program for quick solutions.

If you need better returns, look into third-party liquidators or deep discounting. For higher-value items, the refurbishment program can give you a second chance to sell. And if nothing works, removal orders will at least stop the loss from storage fees.

The essential thing is to act quickly and choose the method that best fits your product’s condition and sales history. PayGlocal can further support your business by simplifying international payments. Sign up now with PayGlocal to get started!

DISCLAIMER: The information provided in this blog post is intended for general informational purposes only and should not be construed as any advice or recommendation in any manner and is not reflective of any sponsorship or affiliation. While we strive to ensure the accuracy and reliability of the content, it may not reflect the latest developments or interpretations. Users are advised to exercise their own discretion and judgment before making any decisions or taking any actions based on the information provided.