Dead Stock Trapped Capital

It is how much cash is stuck in inventory that is not selling at full price — clearance and slow movers.

Formal definition

Dead stock trapped equals the number of clearance or non-moving units multiplied by average wholesale cost per unit.

Why it matters

Dead stock ties up open-to-buy budget and warehouse space; it often ends in deep markdowns or write-offs.

Where you see it

  • Inventory aging reports
  • Retail merchandising reviews
  • Open-to-buy planning
  • Liquidation and outlet channels
  • Year-end inventory write-downs

Worked example

  1. Clearance units: 400.
  2. Average wholesale cost:
  3. Dead stock trapped = 400 ×
  4. Interpretation: $4,800 of capital sits in slow or clearance inventory.

How Business metrics calculates it

Clearance units × Average wholesale cost.

Where people fool themselves

Dead stock at wholesale cost is cash. Dead stock at original retail is a feeling. We use cost × units when you enter those fields.

Run it on your own numbers: the Retail & E-Commerce calculator.