098: Using Mystery Boxes to Reduce Inventory Before Year End

One of the biggest challenges for product-based businesses is our inventory. Too much, not enough. What happens if it doesn't sell? On this episode, I'm talking you through my mystery box strategy for liquidating your stale inventory. Don't drag your 2022 baggage into 2023. Come listen.

Welcome to the Launch Your Box podcast with weekly tips, tricks, and strategies to start, launch, and grow your description box. Now here's your host, Sarah Williams.

Welcome back to the Laundry Box Podcast. Y'all, it's that time of year. The year's coming to the end, and it's important to use this buying season to liquidate any old or stale inventory that you have from maybe this year or previous years. I, I'm sitting on a lot of inventory, like So much it's making my skin itch, uh, and I need to liquidate some of this inventory. And if you're in the same situation that I am, maybe you don't even have a lot. Maybe you just have a little bit left over and it's just been staring at you every day. But let's talk about how we can use mystery boxes to reduce our inventory before the end of the year. It's really important to take year-end physical inventory when your inventory is at its lowest. So Taking the time to reduce your inventory right now will be the easiest all year long because we're in this buying season and we don't want to wait till everybody is out buying their 75% off wrapping paper at the big box stores and we're over here trying to liquidate our old inventory. Let's do it now by planning some mystery boxes. And planning these mystery boxes is a great way to reduce this inventory without putting clearance tags all over your store, all over your product, all over your website, because that devalues devalues your offer, and that devalues your subscription box if these items have been in previous subscription boxes. And you don't want to have that stigma on your subscription box, like, I'll just wait till it goes on clearance. We don't want to operate that way. And there could be several different factors that have contributed to this product that you might have left over, this inventory that you have. Maybe you've made a bad buy. If you've been in business any period of time, like, you bought something that you thought was going to be a hot seller, and maybe you went deeper than you normally do, and you're sitting on that product because you made a bad buy. You made a bad decision. I look at some things that are laying around in my warehouse right now, and yeah, I was like, oh, that was a bad buy. And I, and I think I get caught up in the moment, like when I'm at market or when I'm working with, uh, different manufacturers, and I get excited and they get excited and they're selling me, right? Like they have sold me, and I buy product that I know maybe is not the best product for my store. I like it, I think it's awesome, but it— something about particular product just doesn't sell well online. And so I have some of that, I have some of those bad buys laying around my inventory, and it's okay. We're gonna make mistakes. Not everything that we buy is gonna be a hot item. Like, we have some misses here and there, but maybe you've overbought on your subscription box. Planning to increase numbers, especially if you're planning far ahead like me, and you just didn't hit the mark, and you've got, you know, several pieces of this and several pieces of that, and a bunch of kind of leftover stuff from boxes. We gotta liquidate that. Or maybe you just had a slower year than last year as far as sales. I mean, we've been dealing with a whole bunch of stuff in 2022, and so maybe you, you're just not moving stuff as quickly. This is what we're going to talk about, about using mystery boxes to reduce your inventory. But I first, I want you to take every opportunity from now until the end of the year to sell the old and stale inventory. And you can do that in lots of different ways. You can pair something old with something new, perfect way to liquidate it. You can use an item as a free gift with purchase. So purchase $100 or more, get this free gift. It's a great opt-in. It's a great way to increase your average order value, um, and you're liquidating product. You can also take some markdowns on some of your product right now and set up a stocking stuffer section on your website or in your store, um, kind of reduced some of those in hopes of liquidating quantities. But as you do this right now, like in November, I want you to think about what you still have hanging around, say mid-December. Let's put together a mystery box and get rid of it for good. You don't want to drag 2022 baggage into 2023. I still have 2021 baggage that I've dragged into the end of 2022, and I definitely don't want to take that into 2023. So let's get that cash back into your bank account and get the space back on your shelves. And here's the goal when you do these mystery boxes: our goal is to get our money back, okay? I want you to hear me say that. Our goal is to get our money back. Do not overprice these items. Don't focus on making a profit, if any profit at all. We need to liquidate it and move on, okay? And I know it's hard to think about that when we don't do that all year. When I tell you, you've got to have a profit margin on your subscription box that's sustainable and long-term. This is not that. We are going to liquidate and move on. That is our goal here— liquidate and move on. Okay, so let's talk about the reason why I love mystery boxes so much, and I know you're going to love them too if you've never done one. Um, let's talk about some of the reasons why, um, would we want to liquidate product You guys know if you've listened to me any amount of time, I don't love discounting our offers. I don't love discounting subscription boxes. I don't love running sales all the time. I need to liquidate this product without screaming that it's 50 or 75% off. Okay. And I can do that with a box without devaluing that because I'm not saying clearance, clearance, clearance. All over my website, I'm saying grab this mystery box, it's super fun, I'm going to give you a whole bunch of value. And I can promote it as a fun event versus a clearance sale like big box stores. And the excitement of not knowing what's inside really brings excitement to this offer. It's different. They might get something that they already have. If you have a lot of subscribers like I do, or even, even if you have a small amount of subscribers, we need to be sure that when we promote these boxes that we let them know, hey, there might be something from a past subscription in here, so that they don't open it and say, oh, I already have those two things. Well, there might be something from a past subscription in there, so we gotta let them know up front that could be a possibility. But I want to make sure that you mix some items that have been from past boxes with items that were not in boxes at all. So it's not just a box of subscription box leftovers. Okay, we don't want to devalue our subscription box, so we don't want to just do that. Now, the problem you might be thinking is, what if I only sell my subscription box, Sarah? Like, I don't have other products, so everything that I'm going to put in this box is going to be subscription box leftover. Well, Here's my idea. Right now there is a whole bunch of wholesale vendors selling product cheap— $1, $2, $5. They're trying to liquidate their stuff too. Buy some things that are cheap right now. Like, I got a whole bunch of stuff for low prices. I'm going to add to these mystery boxes, okay? Because it's something brand new that they've never seen, and it wasn't in a subscription box, so I can get the items super cheap. I'm going to add them to my mystery boxes. It's going to create value. It's going to create some newness, and it's not just a bunch of stuff I have laying around. But that's how I'm creating some excitement for it and something new and different. So you could do that as well. Say you're going to put together 50 or 100 mystery boxes this season. If you see a vendor and they're going to start selling their stuff quicker because they need to liquidate it after Black Friday— they need to— wholesale vendors need to liquidate their stuff now. Um, so if you find something from one of your vendors marked down that you've never used, snag some, and to fill these mystery boxes, just to add a couple things that are brand new that your subscribers have never seen. Okay, and so having that mixture of older items and newer items is going to create a sense of exclusivity, some fun, some newness that you won't have if you just only have subscription box items. Okay, I sell a lot of different things in my store, so I'm going to have a great mixture of subscription box leftovers, product that was just on my website. I mix in 1 or 2 little new items that I've gotten at a great deal, and boom, I have these really awesome mystery boxes. Okay, the other thing I want you to think about is with these boxes you could also create different price points. So last year when we did our mystery boxes, I created 2 different offers. One was a $50 box and one was a $100 box. We put a ton of value in these boxes, and I, and I said that you're going to get like with the $50 box your box is going to be valued over $100. And if you get the $100 box, your box is going to be valued over $250. So I showed the value of those boxes. Okay, you could create whatever price points that you want to. You could also do like— I'm thinking about doing like a $20 swag mystery bag, like just some leftover t-shirts, and that's all it is, just a bag full of t-shirts or something like that. So you can create different price points. And fill them up. I like to pre-fill mine, okay, because there's sizes involved with my products— t-shirt sizes, sweatshirts, there's sizes. So I want to make sure that I only offer however many I can fill per size. So I'm going to take some time to pre-fill mine. So I'll lay all the boxes out. I'm going to figure out how much product I have of each size, and I'm going to start to fill them. You don't have to pre-fill them, especially if you don't have size variations. Um, just make sure you don't oversell what you have left. So kind of get an idea of about how many boxes you can make with the stuff laying around, and then you can sell them, or you can pre-fill them so that you don't kind of panic and worry about, you know, overselling too much. And you also don't want to undersell. Like, if you have all this product and the mystery boxes are selling really quickly, and you're not sure how many boxes this will fill, so you cut it short, and then you could have sold more. 'cause you have more product on your shelf. So that's why I like to pre-fill 'em. We usually do this like the week before Christmas. Everything's kind of died down for us because we're mostly an online shop, and so we kind of have a good idea of what we have left with inventory, and we'll start to pre-fill these, and then I can sell them immediately that week, or I can wait until after Christmas and sell 'em. I don't mind selling them before Christmas. I think they're fun. I think it gets in front of the noise of the after-Christmas sales too. So don't be afraid to sell them the week of Christmas. They're probably— if you're shipping, they're probably not going to get there on time. So you just have to tell them that these are not guaranteed for Christmas arrival. But what a fun surprise to get, you know, after Christmas when they do arrive. So this is how we pre-fill them. I lay out all the boxes. I start with, with boxes. Okay, so we're subscription box owners. We probably have a bunch of random boxes laying around that we don't use from month to month. Some of mine are different sizes because of the different, you know, size products that I use. I have to have some different size boxes sometimes, but we all have boxes laying around. There are boxes somewhere. Grab those boxes. You don't have to order a special box. I don't want you to order a special box. I want you to use what you have, or grab some cheap boxes off Amazon if you don't have anything laying around, and just make a sticker that says mystery box or something on it, stick it on there, and then let's fill them up. These boxes are not all the same, so I don't want you to treat this like you would your subscription box where everything is the same that goes in these. And we can say this too, we need to tell them that not everything is going to be the same in these. And so if you get one and your best friend gets one, it's highly likely that you're going to have different items in your box. So I might have like 20 of one thing or 30 of another thing or 100 of one thing and 200 of another thing. I just figure out how many boxes I want to start with, and sometimes I'll add more as I go when I see about how much stuff I have. Once I start pulling stuff out of these shelves, I realize how much stuff I really do have in inventory, and I can typically make more than I thought I could. But what I'll do is I'll line up rows of boxes. Okay? And so I'll maybe do a table of small, a table of medium, because remember, I've got sizes going on in here, and I'll just start filling them. So I'll start maybe with a t-shirt. So I'll grab all of like my broken sizes. So if you sell clothing or anything like that that has sizes, you know, broken sizes means that we're out of any particular sizes. So I just love to take those off the website because people get frustrated when they're shopping. Like, if I'm shopping and I I see a cute t-shirt I like, and then I go and they don't have my size. So anytime that I get a couple broken sizes out of a 6-size size run, I want to kind of pull those off and use those for mystery boxes so people aren't frustrated. But anyway, so I'll grab my broken sizes and I'll start filling them, and I might have 10 of one shirt or 20 of one shirt or 40 of one shirt, and I'm going to start to break it up, and I might put 2 shirts in every mystery box. So everyone's getting 2 different shirts and they're all going to be different. Okay, I just make sure that everybody gets 2 shirts. It doesn't matter what shirt they get, they're getting 2 shirts. Then I might add a sweatshirt or a hoodie. Then I might add some jewelry. So I'll grab some earrings or bracelets or necklaces, and you might get an earring, but your best friend might get a necklace, your mom might get a bracelet. So it's just a similar item. I just try to go down the row and find a similar item in size and value. So that's a jewelry piece. 40 people might get a pair of earrings, 20 people might get a bracelet set, 20 people might get a necklace, but everybody has a piece of jewelry. And so I'll just start to lay them out and see what I have left over and start to get rid of it. Then I might add a bag, then I might add a cute notepad, you know, whatever that is. I just try to find something similar. So I'll go down the row. Everybody's gonna get a zipper pouch of of some kind. I have tons of them, and so everybody's going to get something of that. So that's how you can fill these mystery boxes. And then at the end of the day, you've got all this old product off of your shelves, you've got room for some new product, you're not promoting and trying to sell the same thing over and over again as we go into the new year. When I close these up, I have these little size stickers, so I'm going to put the size of them on the outside. You could also mark them with the price somehow. So this box is a $50 box, this box is a $100 box, this box is a $20 box, or however you want to do that. But then we label them by size, we tape them up. We don't, we don't know who's getting what. So then when the orders come in, we just slap a shipping label on it and it goes by size, who that's for. We're done with all the inventory and they're like busting at the seams. Okay, so they are busting. These boxes are busting, and I love them because I like almost can't even close the, the box. So it feels much different than their subscription boxes, even though they're in the subscription box boxes that I normally send. I'm going to stuff them full, but they're going to feel different. It's not curated. The stuff does not go together. So if I give you a t-shirt, I might give you a pair of earrings that doesn't even match and something else that doesn't match. It's not curated. Like your boxes, and that's very important. We need to show them a difference, okay? We need to show them that our box is carefully curated for an experience. The mystery box is just a whole bunch of product. You're getting value, you don't know what you're getting, and it's fun and exciting, okay? So there's a very clear difference. But once you get them all lined up, once you get them filled and closed, you're ready to start selling them. Okay, all you have to do is get a product listing up on your website and we're going to start to sell them. I like to start teasing them out about a week before I'm going to sell them. I don't want to do that too early. Um, you don't want the shopping to stop. You don't want people to stop spending their money with you because they're waiting for the mystery boxes. Like, they're anticipating these boxes. And then if you've done them before and people love them, they're waiting for them. Right? Like every year, I— people are like, I can't wait. My box was so awesome last year. So you don't want to talk about them too early so that people stop shopping from you in anticipation of these boxes, but you don't want to not let them know they're coming either. You want to make sure you're setting yourself up for success. So I always start to tease it out like, hey, mystery boxes go on sale next week. Make sure you're watching so you can grab one. I always go live. You guys know I'm a big proponent of going live, and what better way to go live than to be excited about these mystery boxes? So I'll go live, I'll send out a text that I'm live, and I'm not going to show them anything. These are mystery boxes for a reason. I will grab one of the boxes that's so stuffed full, like it's bulging, right? Like it's so stuffed. It— like when you open this box, it's like opening, opening a can of biscuits. Like it just kind of oozes out all the awesomeness everywhere. And I will talk about how much value is in each box. I will tell them that there could be subscription box items in these boxes. It could be something they've already bought from my store. It could be something they've received in their boxes. So I don't want to give them false hopes that everything in these boxes is new and different, because it's not. And they need to be fully aware of what they're buying because there's no returns on these, okay? And that has to be stated in your description too. Like, these are non-refundable, they are huge value, one time only. If you have store tags on these, I would remove them, um, so that they don't end up anywhere you don't want your store name to be. But just know that it's about getting rid of your stuff. Okay? Don't try to make this profitable. It's not about profits. Make it about letting go and starting fresh in the new year. Is there something that you've been walking by every single day that you wish were gone? Mystery box. Are there samples that you've bought that you have one-offs on. I do that all the time when I get my samples in for products, and I have to tweak the sample, and I get multiple samples, you know, like I just got 3 of this bag that I put in my October box. Well, they're all laying in my office. They're all great bags, but we had to tweak something. We know we removed a zipper, or we added a clasp, or we did something else. So each of these samples are kind of one-offs. Those are great mystery box items. Do you have like sets of something? So maybe if you have sets of something that came as a collection, you could break them open and put the individuals in different boxes. Great way to liquidate some product in these mystery boxes. The goal is to liquidate. Don't bring that stale inventory into 2023. If the idea of creating a subscription box is swirling around in your head, I encourage you to head over to launchyourboxwithsarah.com, get on our waitlist, and grab some of our free downloads to help you get started. That's launchyourboxwithsarah.com.