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Start free trialThis 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#
- Pull the slow-and-dead report past your aging threshold.
- Confirm flagged items against open orders and recent receipts so a data lag doesn't mislabel a live SKU.
- Stop the bleeding - purchasing cancels or pauses reorders on every confirmed item.
- Decide the disposition for each item using the table below.
- Execute - sales applies markdowns and bundles; purchasing arranges returns.
- Record write-offs and apply a reserve (manual - see the caveat below).
- 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#
- No fixed cadence, so review only happens at year-end when the write-off is huge.
- Flagging without confirming, then discounting an item that was just reordered.
- Leaving reorders on - the report clears but the same SKU refills next cycle.
- Treating every item the same instead of working down by tied-up cash.
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.
InventoryQuick starts at $19/mo and its Dead Stock Finder surfaces aging items from your live data so step one of this SOP takes seconds.
Related: Physical Inventory Count - Cycle Counting vs Physical Inventory - Inventory Best Practices - Reorder Point Formula
Common questions
What is dead stock?
Dead stock is inventory that has had no sales or movement for a defined period - commonly 90 days - and has little prospect of selling at full price. It ties up cash and storage space.
How do you identify dead stock?
Run an aging report that flags items with no movement past a threshold (a 90-day default is common, adjustable by category), then confirm against open orders before acting.
What should you do with dead stock?
Choose a disposition per item: discount it if it still sells slowly, bundle it with a fast mover, return it to the supplier for credit, or write it off or donate it when there's no demand and no return path.
How often should you review dead stock?
Monthly. A fixed first-of-the-month review keeps slow stock from quietly aging into a large write-off.
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