Closeouts and Good Deals
My family has a saying, long attributed to my grandfather: “We can’t afford an elephant, but since they’re half price we’ll take TWO!” There’s just something compelling about getting a bargain. That applies not only to people as end users but to businesses too.
My category managers at my work regularly negotiate special buys and acquire closeouts that provide our dealers with increased margins. As you might expect, those are always popular. In fact, I have a list of dealers who always want to be notified when a special buy comes up. One of them in fact was adamant when we first. “Lee,” he said, “I don’t care what it is, even if it’s outside my core business, let me know when you have a special buy.” The worst that could happen, as far as he was concerned, was that he’d take a pass on it.
It’s good to know whom you can call when you’ve got a deal to offer, but that does occasionally cause problems.
Years ago on our weekly call, our category manager laid out the strategy for transitioning from a popular but now-discontinued SKU to its replacement.
The new SKU was going to arrive in three months. In the meantime, he had bought every remaining unit of the old SKU from our vendor at a special buy price, and we’d sell through that stock until the new unit arrived. The first call I made was to my highest-volume dealer for that SKU. Talking to my client I explained that the new one was three months out and we’d acquired the remaining inventory of the old one from the vendor.
“How many do you have left?” she asked.
So I told her. It was a lot.
“I’ll take them all. I’ll get a Purchase Order Number and text it to you.”
Great! I thought. Always nice to finish off your entire month with one order.
Not everyone shared my sentiment. My category manager called me.
“Lee! That inventory was supposed to last us three months, for the whole country, and your customer cleaned us out with one order!”
“Well, okay” I acknowledged “but money talks. Are you telling me I have to tell her we won’t sell them to her?” I asked.
“No of course not” he admitted, “It’s just, ugh. Okay, fine. Whatever, we’ll manage somehow.”