The Business
A furniture store with a large showroom floor, where slow-moving pieces historically stayed on display indefinitely. Taking up valuable floor space and tying up capital. Because there was no rule for when to mark something down.
The Problem
Furniture has a naturally slower turnover than most retail categories, which had become an excuse to let genuinely dead stock sit for a year or more. Nearly 15% of showroom inventory value hadn't sold in over six months, quietly occupying the store's most expensive real estate: the showroom floor itself.
What They Changed
- Set a firm rule: any piece with no sale in 120 days gets an automatic markdown
- Ran a one-time clearance push on everything already past 120 days when the rule was introduced
- Started tracking days-on-floor per item going forward instead of just tracking whether it eventually sold
The Result
Showroom dead stock value dropped 50% within one quarter, freeing up floor space for faster-moving pieces and converting stalled inventory back into cash instead of letting it depreciate further.
A firm markdown rule beats an indefinite "it'll sell eventually" approach almost every time. See Inventory Management Guide for more on managing slow-moving stock before it becomes a total write-off.
Could This Apply to Your Business?
- Is there a firm markdown rule for slow-moving stock, or does it stay on the floor indefinitely?
- Do you track days-on-floor per item, or only whether it eventually sold?
- How much showroom value is currently tied up in stock that hasn't moved in six months?
FAQ
Isn't slow turnover just normal for furniture?
Furniture does turn over more slowly than most retail categories, but that reality had become an excuse to let genuinely dead stock sit for a year or more without any markdown trigger.
What was the actual rule that fixed this?
Any piece with no sale in 120 days gets an automatic markdown, paired with a one-time clearance push on everything already past that threshold when the rule was introduced.
Why did dead stock matter so much for this specific business?
It was occupying the store's most expensive real estate, the showroom floor itself, while also tying up capital that could have funded faster-moving pieces.
Read the Guides Behind This Story
- Why Inventory Mistakes Destroy Small Businesses. the guide behind this story
- 10 Signs You've Outgrown Excel for Inventory. the guide behind this story
- Inventory KPIs Every Business Should Track. the guide behind this story