Dead stock is inventory that has no realistic path to a full-price sale within a reasonable planning horizon. It still carries cost — storage, insurance, capital — but no longer generates margin at intended rates.

How is dead stock different from slow movers?

Slow movers still sell, just below the pace you would like. Dead stock has effectively stopped. The right action for a slow mover is usually merchandising; the right action for dead stock is an exit.

What is the true cost of holding dead stock?

Between storage, insurance, shrinkage, and capital tied up, most brands pay 18–25% of the value of held inventory per year. That is before you consider the opportunity cost of not investing that cash in faster-moving SKUs.

How does Reversify identify dead stock?

By combining rolling velocity, days on hand, category benchmarks, and margin projection. A SKU is flagged as dead when its projected sell-through at current velocity does not clear the on-hand quantity within its planning horizon at a margin above liquidation.

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Dead Stock Analysis

Dead stock analysis: quantify it, exit it, learn from it

Dead stock is the compound interest of bad merchandising decisions. It looks harmless on the balance sheet until you calculate the annual carrying cost, at which point the picture changes. Reversify's dead stock analysis identifies the SKUs that have effectively stopped moving, quantifies what they are costing you, and recommends the highest-yield exit path for each — from bundle to liquidation to donation.

Automatic identification with margin-aware thresholds
Carrying cost quantified per SKU and category
Ranked exit paths from bundle to liquidation
Feedback loop into buying so the pattern does not repeat

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Defining dead stock properly

Most spreadsheet definitions of dead stock are naive. They pick a threshold — "no sales in 90 days" — and flag anything below it. That definition catches obvious cases but misses two important ones: SKUs that still trickle but will not clear at current velocity, and SKUs that appear healthy today but are on trajectory to become dead within the current season.

Reversify uses a projection-based definition. Given a SKU's current velocity, seasonality, and margin, will the on-hand quantity clear within its planning horizon at a margin above liquidation? If the answer is no, the SKU is dead — regardless of whether it sold a single unit yesterday.

The real cost of holding it

The visible cost of dead stock is the storage fee your 3PL charges every month. That is usually the smallest number in the equation. The bigger numbers are the capital tied up (which has an opportunity cost equal to whatever your next-best inventory investment would return), insurance and shrinkage, and the eventual markdown or liquidation loss when you finally move the units.

Reversify calculates the full carrying cost per SKU and rolls it up per category, so the conversation stops being "should we clear this?" and starts being "we are losing $X per month by holding this — what is the fastest exit that beats that number?"

The exit ladder

Bundle. Pair the SKU with a hero product at a small combined discount. Preserves margin while moving units. Works when there is a natural cross-sell.

Structured markdown. A published discount tied to a merchandising moment. Preserves brand while accelerating clearance. Reversify computes the break-even discount so you never mark below true landed cost.

Wholesale or B2B. A bulk offer to an off-price partner, employee sale, or B2B customer. Lower unit margin, faster cash conversion.

Liquidation. An external partner takes the remainder at pennies on the dollar. Recovers some cash, stops the carrying-cost bleed.

Donation. Where liquidation would not clear the carrying cost, donation with a tax write-down is often the highest-yield exit.

Closing the loop with buying

Dead stock analysis pays for itself once. Feeding the pattern back into your buying decisions pays for itself every season after. Reversify aggregates dead-stock outcomes by supplier, category, price band, and buyer so you can see which parts of the catalog systematically overbuy. That view is uncomfortable at first and hugely valuable at second — brands that adopt it typically cut their dead-stock ratio in half within two seasons.

The point of dead stock analysis is not to punish past decisions. It is to make sure the next buying cycle starts from an honest baseline.