It’s that time of year again where resellers from all over worry about slow sales. It seems like the slow sales seasons get longer and more stressful than the previous season. But why? What causes slow sales in reselling?
Depending on your business practices, “slow sales seasons” can vary to any part of the year. Understanding how different issues directly and indirectly affect your business can give you valuable information to reduce unwanted effects. Or better yet–eliminate the effects all together.
Identifying Slow Sales Culprits for Slow Sales
I’ve been on the online reseller forums. As much as I love this community I belong to, it’s important that we change our language and our expectations for our own sake.
I agree that there are a lot of out-of-our-hands situations that keep us from maintaining a decent sales volume. We are a vital part of reverse logistics, but our inventory is sometimes more dynamic and ever-changing than retail. Return policies, merchandise availability, and liquidation processes of each company play a role in what inventory available for us. This requires a level of adaptability as resellers.
Put simply, you cannot control what you cannot control. This article is not intended to frustrate you or make you feel like there’s nothing you can do. The intent is to help you identify which of these seven culprits of slow sales affects your business the most. Once you have this knowledge, use it as a tool to help you combat those issues. Then make a plan to reduce the stress of slow sales on your business as a whole.
Common Slow Sales Culprits
Holidays will always affect your business, either for the better or for the worse. You see this when big box companies capitalize on consumerism during these times. If you walk into any department store, chances are you’ll Christmas trees for sale before Thanksgiving is even over. It’s a popular tactic, increasing the amount of time that people have to purchase holiday-specific merchandise.
When it comes to the reselling community, though, it’s a different world. Many of us who work in liquidation will not receive liquidated, holiday-specific items at the appropriate time. If there is inventory available, it is a high-dollar pallet to purchase items within season. Those pallets are so high in price that the margins are not even worth it to purchase. Joe and I usually expect Christmas inventory between January and April.
When we first started out, we didn’t have the luxury of holding on to Christmas items until the proper season. We desperately needed the sales. But, over time, and with a plan, we were able to store holiday decor and seasonal items for appropriate times. This ultimately allowed us to make higher profit from them.
This may not be a solution that you can manage right now. However, should you find items that are holiday specific, try and keep some until the appropriate season. You can still them for cheaper than retail, and that is appealing to your consumer. But, you will also be able to price them higher, if you can manage it. The hope is that you can save those extra profits for when the season has ended, when sales slow.
The economic market is always changing, and every business reaps the consequences of that. However, when you’re a reseller whatever effects the economy has on consumerism will affect the retail stores first. Pay attention to how the economy affects the consumer market for big box companies, so you’ll see it coming before it hits you.
Unless customers are consciously trying to change their buying habits, they will not stop purchasing items. Consumers who like to go out to eat may opt for water instead of a fountain drink when they go out to eat to save money. They will continue to go out to eat anyway unless a conscious effort is made to change that habit.
As a reseller, you can use this to your advantage. If the economic market is making it harder for people to purchase brand new, those consumers who are not going to change their buying habits may start purchasing used or slightly imperfect items to save money. Think about your marketing strategy. Do you have one? Is there a way that you can use this to your advantage?
Different seasons affect different resellers. Your region, the inventory you have on hand, and the need for particular items at particular seasons affect your sales. For example, we tend to have slower sales during the summer (May through July), especially our local market. We know that our region is full of people who love the outdoors. With national parks, rivers, and campsites everywhere, our local market spends less time shopping and more time outside.
We combat this by trying to source outdoor products that people want for their next camping trip or pool party. Adding discounts local items convinces our customers to purchase it from us rather than our competitors. We want customers to feel confident in their purchase, so we allow our locals to test items before buying it. These are just a few adjustments we’ve made to help our sales during slow summer seasons.
Our online market, which serves a larger demographic of people, experiences slow seasons, too. We revisit our inventory and update our listings to make them more attractive. We offer free shipping and free returns as well. It is important to utilize seasons of slow sales to refresh stale inventory and maintain that competitive edge.
4. Consumer Trends-
Consumer trends are often hard to identify, especially in an ever-changing market. Many resellers are trying to find as many items at low cost as possible to make high margins. It is necessary to buy low and sell high, and I won’t argue with that. But when it’s sitting on the shelf for months because it’s not what the consumer wants, you’ve got a problem. That money is currently sitting on your inventory shelf doing nothing for you.
If your sales are slow, take a look at the inventory you have on hand. “Replenishables” are items that are easy to find, sell all year round, and are constantly in demand. Items such as makeup, staple clothing, electronic accessories (such as headphones), are examples. Look at your own inventory. Are all your items people may only buy once, seasonal items, or collectables? You may want to consider diversifying your inventory.
This may be a last option for some resellers, who prefer to specialize in vintage or collectable items. But consider this: every month you keep that item listed, you’re spending more money and lowering your profit potential. Then, would you be willing to diversify?
If you plan to diversify, first determine how the consumer values the items you already have listed. You may need to update or add to your inventory with more in-demand items that customers would want. Try sourcing those products and see if your sales make any changes. You might make lower margins on items like that, but you can continue sourcing your usual inventory. You’re simply supplementing it with quick selling items to offset the slow sales. You can have both!
5. Market Saturation-
As the reselling community grows, be aware that the easy-to-find liquidated items will be harder to sell. When there are more people selling an item, it reduces the chance that people will choose yours. There’s nothing you can do about that. I see a lot of people getting upset about this, and you’re entitled to that. Just know that’s not productive. If you’ve been in the reselling game a long time, you know that the market is always changing. You can only adjust, you cannot control what your competitors do.
One thing that we do to help with our own sales is to look at the listings from our competitors. How can we make our listing more appealing? Can we take better pictures? Can we add more information about the product so that customers will feel more confident buying from us?
On the local front, how can we market our products so people will feel confident purchasing them from us? How do we make our local market see us as more appealing than the other places they can purchase from?
Another option is to try different sourcing techniques. If you are a liquidated goods reseller, try your hand and sourcing more unique products. This is where networking comes in handy. With great networking skills, you will have the advantage of being able to negotiate inventory that enhances your game. Your sources will benefit from regular purchases from you. You can even negotiate new and unique perks between you!
Not paying attention to market trends of items you’re listing is a huge mistake. Take the time to review listings. Remember that what items are listed for are not always necessarily what the market values them. An item is only worth how much it sells for. Keep an eye on your listings and be prepared to adjust your prices to keep them competitive.
Try experimenting with sales, coupons, and discounts to see if it drives sales. Many resellers may cringe at the idea of discounting already discounted items. As for me–I’ve got bills to pay and I’d rather see 10 dollars in my pocket than 15 unspendable dollars sitting on a shelf. If you are not selling anything, your cash flow will become stagnant. If you are not making money and then turning around and reinvesting that money to grow it, your business is already dying.
Ah, don’t come at me for this. I’m only telling you this because I want you to be successful. Listen, it is okay to take pride in your business and the inventory you have to sell. However, what you value an item for may not match what other people value that item for. This is an easy trap to fall into, and we have all done this at one time or another. When you spend the time purchasing, testing, cleaning, taking photos of an item with the intent to get “x” amount of profit from it, it feels like a personal insult when nobody wants to purchase that item from you at that price.
I see resellers all the time bad-mouthing “low-ball offers” or taking it personally when customers are always trying to “cut them a deal”. Before you start getting offended, ask yourself, “am I too emotionally connected to this item? Am I taking this as a personal insult?”
Step away from your business for a moment. Take a look at the way you’re handling the business. Where is your emotional investment located? Do you take it as a personal insult when people do not want to pay what you believe your product is worth?
Get Started by Adjusting Your Own Mindset
The only thing we can control is ourselves. And that, my friends, is on a good day. A successful entrepreneur will not only adjust their business to withstand the trends, but they are unafraid to adjust their mindsets. to protect their attitudes and avoid burnout. Don’t let the things that you can’t control make you forget why you got into this business in the first place, whatever that reason may be.