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Why Dead Inventory Is Costing You and How to Fix It

Boutique Chat
Boutique Chat

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When you think about building a profitable boutique, what comes to mind first? Marketing? Merchandising? Trend-spotting? All important, sure—but according to MaxRetail founder Melodie Van Der Baan and The Boutique Hub’s Ashley Alderson, if you’re not obsessing over turn rate and smart markdowns, you’re leaving money (and peace of mind) on the table.

In a recent interview, the two retail powerhouses talked shop—literally—and dropped gold nuggets on everything. Here’s what we learned.

Why Dead Inventory Is Costing You and How to Fix It

The Myth of the “Fine Wine” Inventory

One of the biggest mistakes newer retailers make? Holding onto slow-moving inventory like it’s going to age like a fine wine.

Spoiler alert: it doesn’t.

Melodie broke it down with a powerful visual:

“Let’s say I buy a makeup bag for $10 and sell it for $20 the next day. I reinvest that original $10 and do it again—10 days later, I’ve made $90 in profit. But if it takes me 10 days (or months) to sell that same bag once for $20, I’ve only made $10. That’s the power of turn.”

Turn, or how often you sell through inventory, directly impacts your cash flow and profit. When an item isn’t moving, mark it down, sell it through MaxRetail, and reinvest that cash into something fresh. As Melodie put it, “Time is the most precious thing we have and it cannot be stored today and banked for tomorrow.”

Cash Is King—and Markdown Strategy Is the Throne

Holding out for that full margin might sound good in theory, but Melodie challenges retailers to shift their mindset:

“Could you squeak out 15% profit in a month—or are you better off taking the cash now and reinvesting it in something that will turn faster and make you full margin?”

It’s not about discounting to discount. It’s about using markdowns as a tool to fuel better buying decisions.

Quality Control… and Baby Wipes?

With thousands of orders flowing through MaxRetail, you’d expect a higher error rate—but Melodie says their incident rate is under 2%. How? Clear processes and checklists that every retailer follows.

Yes, baby wipes are part of the process.

“Sometimes retailers will ship a shoe without wiping the sole or checking for makeup stains. But overall, our community is amazing and takes pride in their shipments.”

Lesson: details matter. A clean item and a double-checked packing list go a long way in keeping customers—and resale partners—happy.

Inventory Analysis: The Most Unsexy Yet Powerful Process

Let’s be honest—nobody gets excited about reviewing sell-through reports and inventory-to-sales ratios. But Melodie says it best:

“It’s like drinking apple cider vinegar. It’s good for you, but you’d much rather be calling customers or playing dress up. Still—you have to do it.”

Regular inventory reviews help identify dogs early and clear space (physically and financially) for better investments.

Two Hours Back in Your Day? Do This First.

Melodie’s top income-generating activity? Reaching out to top customers personally.

“I go to my POS, find my top revenue customers, and send them personalized video texts showing them products I know they’ll love.”

It’s simple. It’s scrappy. And it drives serious results. Remember: 20% of your customers generate 80% of your revenue.

The Hardest—but Most Necessary—Lesson

If you’ve ever held on to a toxic employee too long, this one’s for you.

“No matter how much you think you need that employee, if they’re toxic, you’re better off without them. It’s going to feel like firing your sister, but you’ve got to protect your culture.”

Mic drop.

How to Protect Your Peace While Building a Business

Melodie keeps work and family in separate boxes—literally.

“At the end of the day, I close the box, put a bow on it, and put it away. When I’m home, I’m home. My kids don’t care about Pink Friday. They care about me.”

Even if stress shows up in your dreams (hello, midnight holiday panic), don’t let it rob you of real-life moments.

Final Words of Wisdom: Love It, Even When It Doesn’t Love You Back

Every entrepreneur hits moments where the work is hard and the results aren’t instant. That’s when Melodie leans into her favorite piece of advice:

“You have to love it even when it doesn’t love you back. That’s when you find innovation—when you think there’s no other way out.”

This conversation was packed with tactical takeaways and heartfelt truths. Whether you’re a new boutique owner or a seasoned pro, Melodie’s wisdom is a powerful reminder that retail success isn’t about waiting—it’s about acting. Fast turns. Smart systems. Deep customer connections. And always protecting your peace.

Let this be the permission slip you need to finally mark it down, wipe it off, or fire the person holding you back. Retail is real—but you’ve got this.

In This Episode

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