Dead Stock Is Draining Your Margins. Here Is How to Turn It Into Revenue
Excess inventory accumulates gradually and compounds quietly. For most brands it represents 10-25% of total inventory value — generating zero return.
The cost sitting quietly in your warehouse
Excess inventory does not announce itself with a monthly invoice. It accumulates gradually: end-of-season pieces that did not sell through, overstock from a forecasting error, returned goods that cannot go back on sale at full price. The financial impact is real regardless of how quietly it accumulates. Storage costs continue every month. The capital tied up in unsold stock is not available for new production. And eventually, the inventory depreciates.
For most brands, excess inventory represents 10-25% of total inventory value at any point. On a brand with one million euros in inventory, that is 100,000-250,000 euros generating zero return.
Why the standard approaches fall short
- Promotional sales train customers to wait for discounts. Every clearance campaign compresses margin on future full-price sales.
- Liquidation recovers 5-15 cents on the euro. After production, storage, and handling costs, this is a significant loss.
- Keeping it in stock: storage costs accumulate monthly while the product depreciates.
What recommerce actually does differently
Recommerce moves excess inventory through secondary market channels that are separated from your primary sales channel. The key difference from promotional sales is that recommerce is invisible to your core customer base. Your main store does not run a sale. Your email list does not receive a discount offer. Your brand positioning does not shift.
How SPS handles recommerce
SPS partners with ManyCo, a recommerce platform that has raised over $18 million to solve this problem at scale. When you have excess inventory, it moves to ManyCo. They handle the buyer relationships, the pricing, and the secondary market distribution. You receive a revenue share on every unit moved.
- Zero additional work: ManyCo manages all secondary market operations.
- Brand protection: excess stock moves through channels your primary customers do not see.
- Revenue share: you earn a percentage of the recovered value on every unit sold.
- Integrated: recommerce is part of the same SPS logistics contract.
A natural entry point
For many European brands expanding to the US, recommerce is the first SPS service they use. It is a no-commitment entry point: transform excess inventory into revenue with no change to your existing logistics setup. Once you see what the network does with your dead stock, the case for moving the rest of your logistics into the same system becomes self-evident.
