What dead stock is
Dead stock is inventory that hasn't sold or been used in a meaningful amount of time often defined as no movement in the last 90, 180, or 365 days, depending on the business and product type. Unlike slow-moving stock (which still sells occasionally), dead stock is effectively stuck: nobody is buying or using it, but it is still sitting on your books and taking up space.
It happens for predictable reasons: a product goes out of season or out of fashion, gets discontinued by the manufacturer, was over-ordered relative to actual demand, or gets replaced by a newer version that customers prefer.
Why dead stock is a real cost, not just a shelf-space nuisance
Dead stock is not a neutral, sunk cost sitting quietly in the corner it actively costs money every month it remains unsold, through carrying cost (capital, storage, insurance) and the opportunity cost of the warehouse space and cash it occupies. The longer it sits, the more that cumulative cost erodes whatever margin the item would have earned if it had sold when it was still fresh inventory.
How to identify dead stock
You can't spot dead stock from quantity on hand alone a high stock count is common for both a genuinely fast-moving item you keep well-stocked and a dead item nobody wants. The signal is usage history: sort products by days since last sale or last stock movement, and anything past your threshold (90/180/365 days, chosen based on your product category) is a candidate for markdown, bundling, return to supplier, or write-off.
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