Before inventory becomes a cost

For many fashion companies, e-commerce businesses and distributors, obsolete clothing lots are a recurring challenge. Collections that did not sell out, e-commerce returns, or products left over after seasonal changes can tie up capital and take up valuable warehouse space for a long time.

At the same time, there is often significant value left in the products - if they are handled in time.

When does a clothing inventory become obsolete?

A clothing lot is usually considered obsolete when it can no longer be sold through the company's regular sales channels. The reasons vary, but some of the most common are:

  • The season has passed
  • The assortment has been replaced
  • The size distribution is unbalanced
  • E-commerce returns have built up
  • Packaging or labels have changed
  • The product has minor cosmetic defects

Many companies choose to keep the inventory in the hope of future sales, but in practice this often leads to increased costs for storage, administration and tied-up capital.

E-commerce is driving larger surpluses

Returns have become one of the biggest reasons for growing surplus inventories in the fashion industry. According to industry reports, between 20 and 30 percent of clothes sold online are returned, which means large volumes of products must be handled again.

Not all returned goods can be resold through regular channels, even though they are often in very good condition. That is why the market for outlet sales, export and wholesale lots is growing rapidly.

Big differences between brands

The value of an obsolete clothing lot is heavily influenced by the brand's market position.

Well-known brands often have established demand even outside regular sales channels. Products from strong brands can therefore be resold through outlets, export or specialized resellers.

For less established brands, the situation looks different. Despite high quality, demand may be limited, which means prices in bulk sales are significantly lower.

Do not wait too long

One of the most common mistakes is waiting too long to dispose of surplus inventory.

The longer the products remain in storage, the greater the risk that:

  • Trends change
  • Styles are discontinued
  • Packaging and labeling become outdated
  • Market value declines

What can be sold today as an attractive outlet lot may be much harder to convert a year from now.

Gustatempe helps companies find buyers

At Gustatempe, we work with companies that need to dispose of surplus inventory, returns and obsolete clothing lots efficiently.

Through our network of buyers in outlet, export and retail, we help companies find new markets for products that no longer fit their regular sales channels.

"Many companies underestimate the value that still remains in an older clothing inventory. It is often possible to find buyers and create revenue instead of letting the products continue gathering dust in the warehouse," says Jimmy Ingvarsson at Gustatempe.

Our services

  • Valuation of clothing inventory and surplus lots
  • Bulk sales and direct purchases
  • Auctions of surplus inventory
  • Export solutions
  • Logistics and warehouse handling
  • Documentation for accounting and wind-down processes

Do you have a clothing inventory that takes up space and ties up capital? Contact Gustatempe for a free assessment of your lot.