Inventory glossary
What is Obsolete inventory?
Obsolete inventory is stock that can no longer be sold at full price or sold at all, usually because it is discontinued, expired, out of season for good, or replaced by a newer version.
Obsolete inventory ties up cash and shelf space on items that will not sell again at normal price. For a small Shopify store, every dollar sitting in a discontinued product is a dollar you cannot spend on stock that actually moves.
The fix is to catch it early. Review your slow sellers regularly, cut losses with a clearance sale or bundle, and stop ordering more of a product once demand has clearly stopped rather than waiting for it to pile up.
Example
A candle store bought 300 units of a holiday-scented candle two seasons ago. 40 units never sold and the scent has been discontinued by the supplier. Those 40 units are obsolete inventory. The store writes down their value from $8 each to $2 each for a clearance sale, a loss of $240 on the books.
Common mistakes
- Confusing obsolete inventory with slow-moving stock that will still sell eventually, just not quickly.
- Waiting too long to write it down, which overstates the value of your inventory on paper.
- Reordering a variant out of habit without checking if it still sells at all.
Obsolete inventory and SteadyShelf
SteadyShelf's forecasts flag variants with falling or zero demand early, so you can stop reordering before stock turns obsolete.
Work it out for your own products with our free tool: Shopify dead stock.
SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.
Related terms
Dead stock · Excess inventory · Inventory valuation · SKU rationalization · Shelf life
FAQ
Is obsolete inventory the same as dead stock?
Yes, if a candle scent sold well for two years and then sales stopped completely because the brand discontinued the scent line, that remaining stock is obsolete. Dead stock usually refers to the same situation but the terms are often used interchangeably.
What should a small store do with obsolete inventory?
Add it to a clearance collection, bundle it with a best seller, or offer it to an outlet buyer. If none of that works, write it off so your books reflect what you can actually sell.
Let SteadyShelf do this math for every SKU
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