Scavengers pick through garbage collected at a landfill site. Image: Thibaud Saintin,
Obsolete inventory. Almost every company has it. And now it’s eating up valuable storage space, staff time to track it, the subject of brainstorming sessions to get rid of it, and designing sales and operations planning strategies to prevent it from happening again. The longer your company holds on to the obsolete product or inventory, the more it ultimately costs.
So why do companies hold on to outdated, old or obsolete inventory? The most common reason, according to industryweek.com, is the optimistic hope that it will “sell someday.” Leadership might also believe that no inventory is truly outdated because it could be re-purposed or compliment a new product. The bad news? When storage, damage, shrinkage, and the cost of money by year-end is all factored in, your excess and obsolete inventory could be costing your company up to 25% a year. What could your company have done with that $25,000 to grow your business?
Most Certified Public Accountants, like the Summit Group will advise selling your goods at a discount to realize some value out of the obsolete or aging product. However, if deeply discounting the inventory isn’t an option due to a product defect or copyright issues, you’ll likely have to find a way to securely destroy it. You might also be cringing at the idea of taking the inventory write off, and then paying to send it to the landfill.
However, this is where Shred Right’s secure product destruction program provides an attractive landfill alternative. Your product will not end up in a landfill, rather, it will be processed by one of our downstream partners once it is securely destroyed. Your product will flow through our secure chain of custody that starts with one of our AAA-NAID certified security operators picking up your outdated inventory for destruction. Not only is our secure product destruction process monitored every step of the way, you can take comfort in knowing and understanding where your destroyed product will ultimately live its second life. For example, we have had clients whose defective plush toys went on to become lining for animal beds in shelters, and plastic bottles that became new t-shirts and sweaters.
While our process can’t help you generate income out of your obsolete inventory, it can give you peace of mind that your product will not end up in a landfill, it will not end up for sale in a secondary market, and your company will no longer be expending resources on items that are no longer valuable to you.
Destroying your company’s obsolete inventory does not mean you have to send it to the landfill. You can save the planet, save your P&L, and save yourself the headache of dealing with old inventory when you choose secure product destruction instead of a costly visit from your garbage hauler.