This is a standard operating procedure for finding and clearing dead stock. Copy it into your ops wiki and run it on the first of every month.
Slow-moving stock doesn't fix itself
Dead stock is inventory that hasn't moved in a set period and won't sell at full price. Left alone it grows - eating cash, shelf space, and the count time that should go to live SKUs. A monthly SOP turns it from a year-end surprise into a routine task.
What counts as dead stock
Set an aging threshold, then flag anything past it. Thresholds vary by category - these are operational starting points, not rules:
| Category | Flag as slow | Flag as dead |
|---|
|---|---|---|
| Fast-moving consumables | 30 days no sale | 60 days |
|---|---|---|
| General retail | 60 days | 90 days |
| Seasonal | 1 season unsold | 2 seasons |
| Durable / high-value | 120 days | 180 days |
InventoryQuick's Dead Stock Finder runs this against your existing data - no CSV upload - with a 90-day default you can adjust from 30 to 365 days.
The monthly procedure
5. Execute - sales applies markdowns and bundles; purchasing arranges returns.
6. Record write-offs and apply a reserve (manual - see the caveat below).
7. Log actions taken and schedule the next run for the first of next month.
Who owns each step
| Role | Responsibility |
|---|
|---|---|
| Inventory / ops lead | Runs the report, owns the SOP, logs outcomes |
|---|---|
| Purchasing | Stops reorders, negotiates supplier returns |
| Sales / marketing | Executes discounts and bundles |
| Finance | Approves and records write-offs, sets the reserve |
Naming the owner per step is what makes the SOP actually run. An unowned step is a skipped step.
Decide: discount, bundle, return, or write off
| Situation | Action |
|---|
|---|---|
| Still sells slowly, margin intact | Discount 10-30% |
|---|---|
| Complements a fast mover | Bundle |
| Supplier accepts returns | Return for credit |
| No demand, no return path | Write off or donate |
Work top-down by tied-up cash. Clearing the five most expensive dead items usually frees more cash than clearing fifty cheap ones.
Setting a reserve
A reserve recognizes that aging stock is worth less than its cost. Common starting points by age:
| Age with no movement | Suggested reserve (starting point) |
|---|
|---|---|
| 90-180 days | 25% |
|---|---|
| 180-365 days | 50% |
| 365+ days | 100% |
These are operational starting points, not accounting guidance. Reserve and write-off treatment depends on your accounting method and local tax rules - confirm the numbers and timing with your accountant before booking anything. The Dead Stock Finder identifies aging items; it does not post journal entries, so the Record step stays manual and finance-owned.
Common mistakes
Run it on the 1st
The whole point is a single document an ops lead can lift, paste into the team wiki, and execute monthly: thresholds to flag, a seven-step procedure, an owner per step, and a disposition table. Put a recurring task on the first of the month and the backlog never builds.
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Related: Physical Inventory Count - Cycle Counting vs Physical Inventory - Inventory Best Practices - Reorder Point Formula
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