Your Inventory Exit Plan: Converting Unsold Merchandise Back Into Cash
Inventory is the largest cash expense in your store, and it's also the one place most independent retailers are quietly losing money.
Buy it well and it funds your year. Get stuck with it and it holds your cash hostage long past the season it was meant for.
We're excited to chat with special guest Melodie van der Baan, Co-founder and CEO of Max Retail. Melodie has sat on both sides of the invoice: as a distributor watching retailers' unsold goods block the next order, and as an independent retailer watching her own unsold goods block her profit. Max Retail was built to solve exactly that, giving independent stores the same connection to off-price and dropship demand that the big chains have always had.
Together, Management One and Max Retail will walk the complete life cycle of a unit, from the moment you write the order to the moment it needs to leave your store. Consider it an inventory masterclass.
What you'll take away:
How to plan the buy so less of it gets stuck in the first place
What to watch mid-season, while you still have options besides markdown
Where end-of-season goods should actually go, and what they're really worth
How to keep cash moving instead of sitting on your shelves
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Indie Insights Live — Dane Cohen sits down with Melodie van der Baan of Max Retail.
Guest: Melodie van der Baan, Co-Founder, Max Retail
Host: Dane Cohen, Management One
Aired: September 3, 2026
Full transcript, lightly edited for readability.
Dane Cohen: Hello, and welcome back to Indie Insights Live, Management One's weekly podcast series, where we talk to industry movers and shakers, and everyone that's going to help independent retailers thrive, and boy. This week, I know I say this a lot, but this week, this is a big one, because we are sitting down with Melodie van der Baan from Max Retail, and if there is anyone equally or more passionate about inventory than Management One, it's Melodie. And we're gonna get into her background, how she started in the industry, where she is now, and where Max Retail is now, and where it's going. So, some very excited conversations. A little bit of housekeeping before we jump in. We'll be recording live with you. That's why we love when you interact. That's the benefit of being live with us. So, I see Kim from Fargo, North Dakota is here. Ask questions, keep it coming. We'll get to them as we're talking, so if you want to jump in, just put it in the chat. And we will get to it as we go. We will, of course, be recording this session. It'll be available on our YouTube channel, we will send you that link, as well. We have an Indie Insights podcast playlist, and coming very soon, it will also be available on Spotify and Apple Podcasts. It is already, Episode 1 is out, if you want to go check it out on our Spotify and Apple Podcasts profile, but if not, you will get that recording. Okay, so, let me bring in the one, the only, Melodie van der Baan. Melodie, how are you?
Melodie van der Baan: Hello, old friend! Love Management One, and anytime I can get in a room with retailers, I'm happy to jump in it.
Dane Cohen: Well, we are so thrilled that you're here. Okay, Melodie, I want to take it back a little, though, because we have a lot to discuss on what's happening now in the business and how retailers could be getting ahead, but I always like to get to know our guests a little bit, and we have known each other for a long time, so we're going to get to that fun connection in just a moment, but hey, tell us how you started in the industry.
Melodie van der Baan: Sure, so I started back around 2008, and my first job was a distributor, which is really just a nice word for a young girl in her 20s who had a Sprinter van. And I filled it up with the collections of the designers I represented, and I drove store to store, selling these collections to boutiques. And some of you on this call might have had the long, red-haired version of me in your store, or maybe you were out in my van, and that was the, that was my first experience in fashion, and where I first saw unsold inventory. Then in 2012, I opened my retail store in South Florida, Women's Apparel and Footwear. And then I had a sale rack, and suddenly no one was helping me. And so, yeah, the problem continued to magnify, and over the years, it drove me nuts, which led me to today, where I am with Max Retail.
Dane Cohen: Yeah, well, okay, so we've seen all sides of the industry. Tell me, what was it like as a boutique owner, right? When did, you know, you're opening a store that, as everyone knows on here, who's an owner-operator, there are so many facets of the business. When did you really start zoning in on, oh, this inventory thing, this buying thing? This is a mega part of the business?
Melodie van der Baan: I think early on, when you're a retailer, you're focused on getting your customers, right? And so you have this initial idea of what you think your customers are going to want to buy from you. But ultimately, you see who's gonna walk in the door, you see what they touch and feel, what they buy and what they don't buy. And you have to quickly adjust what exactly your store is all about based on this feedback. But unfortunately, we've already bought the inventory, now we have to figure out what to do with the rest of it, and hopefully, we get better and better each season as we continue to get to know our customers. And so, I would say, for me, the hardest problem was getting rid of that inventory, because I had a very small customer base. We were in South Florida, surrounded by country clubs, which is a very nice place to be located. But if the customer came in and they didn't like what they saw how the heck was I gonna get rid of it? And so that just became a really big pain point, waiting for Cinderella to come in and want that glass slipper, and ultimately. I just didn't have high inventory turnover, and I didn't even know that. To be honest, Dane. I didn't want to run sales. I thought they were cringey. And so, a lot of times, my inventory just sat, or I'd merchandise it there, or I'd put it in the back, and if a customer walked in and they'd never shopped with me before, I'd go pull it from the back. And so I would say it was my worst problem, and it pretty much was after I had been in business, around, like, the course of a year or two, that I was like, crap, this stuff just isn't going anywhere fast enough.
Dane Cohen: Yeah, and it's funny, because most, first of all, we're definitely doing a workshop somewhere that's called Markdowns Aren't Cringy. I love that. So, we'll definitely get that on the books. But, you know, I think in anybody on this call, probably, who cares enough to be sitting here for a discussion on inventory, you know, whether it's a gut feeling, whether they know it in the actual number, understand that cash, that's it, that's the key right there, right? When you're sitting on inventory, that is your cash, you have a slow turnover, and then being afraid of markdowns, and then the whole, you know, problem just compounds. And I think that this is such a, and this is where we really get to the meat and potatoes, right? That fear of markdowns.
Melodie van der Baan: Great.
Dane Cohen: When, you know, because that's the moment, right, your fear of markdowns, you have the unsold inventory. Was there a light bulb moment for you when you said, okay, there's got to be a one step more on this food chain?
Melodie van der Baan: Yes. So, I think everybody that is listening and here with us right now has that customer in their head, and they're like, okay, I sold 5 of these tops, I'm down to the last 2, but Marietta bought one of them. And if Marietta sees this on the sale rack, she is gonna give me grief. And it's the fear that the customer is going, who bought it at full price, is going to see it on sale. Right? Or, you heard that customer say, well, call me if it goes on sale, because they've seen so much go on sale, and then, just out of pure spite, you want to not put it on sale, you don't want her to get it, right? Like, this is how we feel. And so, that's why we resist them so much, and it wasn't until I met Management One, which I think was around 2017, 2018. And I said, you know, I hear Management One is helpful to retailers. I don't really know what a planner does, but to hell with it, I'm gonna give it a try. And I'll never forget, I believe it might have been you and Paul.
Dane Cohen: Yep.
Melodie van der Baan: And you sat me down after looking at my data. And you said, Melodie, you're turning over your inventory 1.6 times a year. And I said, well, what does that mean?
Dane Cohen: Exactly, right? What does that mean?
Melodie van der Baan: And when you guys explained to me that, like, Mel, you have the same inventory in-store as you did almost a year ago, I was like, okay, that's pretty embarrassing. And how can I make money? How can I make money operating my business that way? And so, I'll never forget Paul said, Mel, all we have to do is turn your inventory one time more than you currently are, and you're gonna make twice as much money. And that was the encouragement I needed. Because what did I want? I wanted a profitable business. Of course. I didn't just want a boutique, Dane. I wanted a business that I could pay myself on!
Dane Cohen: This isn't a hobby, it's not a volunteer organization, right?
Melodie van der Baan: It's really not, and this, you know, for me, it was my only income for my family. It was not optional. And so I bit the bullet, and I will never forget how aggressive that sale section looked. It was, like, almost a store-wide sale, and it was brutal for a couple of months. And then a year later, we had accomplished our mission. Working with my planner, I got to 2.6 turns a year. And I had half as much inventory in store at the same time next year, so, which meant I had more cash in my bank, and that just fueled my fire even more about, hey man, this is what it takes to be a retailer, not just a boutique owner, but there was a lot of uncomfortable moments I had to get through, and Dane, at that point is when I had started to build Max Retail, from the back of my store. I was building this company. But the aha moment of inventory turnover is how I make money, is now the basis for what Max Retail is.
Dane Cohen: So, that aha moment, right, it's almost the old expression, you can't break out of prison if you don't know you're in prison. So that aha moment is really what allows you to think differently about this, and fun fact, I always like to say this, Melodie was my first call with a retailer when I joined Management One. So, for me, Melodie was what started this all as well. Now, Melodie, as someone who is very prepared, you did kind of come up with a little graphic. I want to put that up, because I think it's so visual. You know, seeing that turnover and how that really impacted your business. And as you're getting that up, I remember when you first started talking to us about, you know, we have this idea, and I'm talking to other retailers, and I'm feeling it myself, like, there's gotta be a better way, and that's how this all started. So to see it go from that seedling of a thought process to what it is today, like, wow.
Melodie van der Baan: Yeah, and it's been a long journey, and I will say, when we first set out to solve this problem, my co-founder Morgan and I, in the back of Blessed Boutique, we didn't know what this was going to look like. All we knew was that we were not the only ones sitting on this inventory. And so, we first built a platform called Swap Retail, and you'll remember that. I'm like, Dane, this is.
Dane Cohen: Wow. Retail. Retail, yes!
Melodie van der Baan: Right?
Dane Cohen: That was, yeah.
Melodie van der Baan: That was 1.0, and we're like, we're gonna help retailers sell, buy, and swap inventory with one another. And yet what retailers continued to say to us was, I just want to sell. I don't want to buy, I don't want to swap, I have vendors to pay, I have new shipments to bring in, and how can you help me do that? Right? Retailers didn't want another retailer's dead stock, and so we went through the wilderness, as I put it, for 6 years, Dane, from 2016 to 2022 to figure out exactly how we were going to help retailers sell their unsold inventory. We found out that they had no desire to do liquidation, because it didn't get them any money to do those exact things, pay their vendors or bring in more merchandise. And so, if another retailer didn't want it, and if they didn't want to sell it to a liquidator, how are we going to really help? So, what we found was that a retailer's past season inventory sitting on the sale rack was still amazing brands, it wasn't damaged, there's nothing wrong with it, it just didn't have the foot traffic coming into the store, who love that brand, and would love a good deal on it, to buy it. And so, we brought that demand to our retailers. And the way we did that was by helping retailers easily sell this past season inventory online to over 400 million shoppers who love the brands that are sitting on their sale rack. And that's what our business is today. It's really the ability to integrate with the point of sale, let you list your inventory by clicking a little tag within it, and that sends a data feed to our site. Our team creates all of your listings, sources images, writes descriptions, and places it on various e-commerce sites and resale marketplaces. Where there's consumer demand for the exact products that you're sick of looking at, that aren't worth your time, but they're certainly worth money.
Dane Cohen: Yeah, and there's a lot of gold here. The first thing for me, and I can really appreciate it as someone who, you know, worked for a family business and an independent retail store. This is a side of the industry that you brought to independent retailers that a lot of them didn't know about, right? A lot of people just thought that the end of the road was, I have to mark it down in my store, you know, maybe I donate it, right? That was the end of the road. Maybe I know about a liquidator, which not everyone does, or met one. You know, there was this, I'm not sure how relevant they are today, but jobbers that used to come around and try to, you know, buy up inventory. But for the most part, this was a very hidden part of the business for independent retailers that they couldn't really get in on, and they couldn't really access. And you have brought that to them, and I really just want to take a moment and let you sit in that, because that is an incredible thing. You know, that is an incredible thing to the ecosystem, the life cycle of an independent retailer. So, really, I think it's an incredible shift that the industry is seeing, and everyone that, you know, can get involved with Max Retail gets to see that part of the industry now.
Melodie van der Baan: Well, and what I will say is the collaboration with Management One has been really meaningful for a retailer. Richie, he's on our little podcast right now, our live podcast. Hi, Richie.
Dane Cohen: Shout out to Richie, right? Richie?
Melodie van der Baan: And he just really understood the part that we played. And so, you know, we've really been enjoying working with Richie and with his clients to help them turn their inventory so that when Richie says, this has to go. Those retailers know, click that button in the point of sale, get it gone, right? Max Retail will go do the work to sell what's not worth your time. And so, you know, when you have a planner, you have that little tap on the shoulder to say, your turnover's slowing down, you're at risk in this category, right? You're at risk over here. So, your planner's gonna help you understand when you need to make moves, and then Max Retail can help you turn the inventory back into cash, and it's just a really beautiful partnership. I'm actually going to show that example. Dane, can you see this in front of me here?
Dane Cohen: I can, and can I just say one thing? You know, Melodie and I got to speak a couple weeks ago, and again, I've seen Max Retail go through, right, from Swap Retail all the way through. One thing that just blew me away, Melodie, was in Shopify, which, you know, seems to be the 800-pound gorilla in the retail world.
Melodie van der Baan: Yep.
Dane Cohen: Seeing that you can just simply tag an item and it pushes it to Max Retail blew my mind. You know, I think in today's day and age, it's so important integration to make it as simple as possible for a retailer, and really, I was blown away with how simple the process is.
Melodie van der Baan: We gotta make it simple. Retailers are busy people. We don't have time.
Dane Cohen: So, as you show this to us, because I think that this is a really interesting thing, like, my instinct may be, as a retailer, why do I have to take markdowns if I can just go from full price right to Max Retail? So, kind of.
Melodie van der Baan: Damn.
Dane Cohen: Debunk that, thought process for us.
Melodie van der Baan: Yeah, let's talk about that. We do have some retailers who hate doing in-store markdowns still. They're the original Melodie 1.0. And so that's fine, because when they see there's a dog, they're just gonna tag it on Max Retail immediately, they're fine to get 80% of their cost back on it. We take a 15% fee when merchandise sells, and then shipping is shipping, so you end up getting 80% of cost back. But we do have many retailers who are like, I'd rather get 80% back, and my customers never see a sale, and it quietly goes away. And that's fine. But when we look at a Management One strategy of inventory markdowns to where we know we are constantly being proactive, this is what I drew up. And I think what's important here is that we look at a couple columns here. Now, our goal in this example is that we're turning our inventory 4 times a year. Now, who wouldn't want to turn their inventory 4 times a year? Right? Now, we know in mid-tier, you might be even getting higher than that. We know in footwear, you're getting lower than that. In contemporary apparel, if you're as Melodie 1.0 or Melodie 3.0, just depends on where you sit right now. But walking through this is to say, hey, if we want to get 4 turns a year, how do we accomplish that? And so, looking at this is to say, we need to be evaluating our sell-through. Immediately. Day 30. We get our inventory in. We're gonna look at it on day 30. I love to give this tip, because we are so busy as retailers, it is hard to know, oh my gosh, day 30 already came and went. Normally, we don't notice that we still have those sandals there until it's October, or unless Richie pointed it out to us, right? Unless someone is telling us, if your Retail ORBIT is screaming it, right?
Dane Cohen: Well, by the way, this is the match made in heaven, because with, on Shopify specifically, with the Retail ORBIT for Shopify, you can track your sell-through just as you're, you know, showcasing right now.
Melodie van der Baan: Perfect. Yeah, that's what you guys need. You guys need resources. If you don't know when day 30 hits for a shipment. You've got to find out. So either use Retail ORBIT. Or put a reminder in your calendar, your Google Calendar, that you need to evaluate your sell-through of your latest whatever, deal 1961 shipment, okay? Now.
Dane Cohen: So, Melodie, you're telling me walking around the store and just saying, I think that came in a month ago, is not the right way.
Melodie van der Baan: We gotta move past that. Yeah, we really, we've gotta pay attention, and I know you're busy, I get it, which is why, for me, it's all about finding the hack. Or finding the accountability partner. I have a wonderful co-founder, Morgan. She is my accountability partner, right? If not for her, I would not do half of the things that I do, because she is constantly there to hold me accountable for it. And so, your planner can act as your accountability partner, Retail ORBIT can act as your quick interface for knowing what's going on, but you still have to make the time to do it, right? It's so important, and it's worth the time. So let's look at this. If we sell through 4 units, I'm basing this assumption that we bought 10 pairs of boots here, okay? Maybe they're 10 pairs of jeans. You pick your category, alright? Now, in the first 30 days, we sell through 40% of them, we sold 4. How much did we make back? We made back $880, but we're still in the hole after selling those 4 units $120. This is what I see most often, Dane, is we don't realize when we're still in the hole. We're almost like we're okay to be in the hole, and I'm okay to be in the hole, this is what I hear. But the weather's not even cool yet. Of course I didn't sell them in the first 30 days. Well, listen, whether the weather's cool or not, time is still ticking, and our inventory turnover is gonna slow down.
Dane Cohen: And by the way, this right here is the difference between margin on paper and cash in your pocket.
Melodie van der Baan: Correct.
Dane Cohen: Right? So on paper, you have a good selling margin on this, right? Because you sold it at full price, but the reality is, you still have 60% of your goods sitting on the floor.
Melodie van der Baan: That's correct. That's correct. We have $600 in cost of goods sold. That is sitting on our balance sheet, not on our P&L. Right?
Dane Cohen: Exactly. Ugh.
Melodie van der Baan: So.
Dane Cohen: Yes, speaking my language.
Melodie van der Baan: So now let's see, what do we do next? Well, if our goal is to sell through everything within 90 days, if our overarching goal is to have this healthy turnover on an annual basis. We must take action. We just gotta do it. All right? So now, we're gonna do a 30% off markdown on our remaining 6 units. So we can see here. 100 for $220, 0 to 30 days. Now we're doing 100 for 154, 30% off. We're gonna sell through 2 more. Now, check us out, guys. We've now broke even, and we made a little. We spent $1,000, we made $188. Now, guys, I don't know about you. I want to make more than $188 if I spend $1,000, so we're not done yet. But again. If we obsess over margin, to Dane's point, we're gonna hold on for longer time. If we obsess on turnover. We're gonna get our money out, and more importantly, we're gonna give our customers something new to see. So we're still working to get these units out. We're gonna now move to a 50% off markdown. Dane and the team would tell you, if you are at 0 to day 30, and you still have the full 10 units, you're going to 50 at day 30. You're not waiting till day 60, if you haven't sold anything. Because the likelihood of you looking at it 90 days from now is very high. So, when it's a dog, if it's not gonna sell, get it out. See, Dane, you guys taught me well, didn't you?
Dane Cohen: Yep, take the emotion out. Sometimes you just bought a dog, it's okay.
Melodie van der Baan: It's okay. Every, everything can't be a winner, right? Just like you can't please everybody all the time. It's okay. So now, on day 60 to 90, We don't have too much left, we got 4 left, or at least we're in the green, right? Now, check it out, guys. Even if we sell 2 more. At half off, we're only making $10 profit, but we are getting our 100 bucks back. Look, now we're up to over $400 in profit on this size run. But now, guys. We still got 2 units left. Everybody on this calls know how hard it is to merchandise the last two units. If it's apparel, it's hard enough, putting it on the racks. If it's footwear, it's even worse, because you don't even want to have them out. If you got that out, of course someone's gonna ask for their size, you don't have it anymore, you don't want to reorder a whole nother run of it. A last two pairs of footwear? They're the worst. So what are we gonna do? We're gonna tag it on Max Retail, so that we can unlock the larger pool of online shoppers, so that Max Retail can send you an order through, and we can get it out. Now it's gone. Now we took those last two units, 85 bucks a pop, yep, shipping, so let's round down to 80, got another $160. Pure profit on those last two units, they're out of your back room. The money's in your bank account, your customers don't have to look at them anymore. And, you know, I gotta tell you, that's what I wish I had, Dane. I did not have a Max Retail. When I was a retailer, and when I think of what we give to retailers today. I'm so happy that it exists, but part of me is like, damn it, why didn't I have it?
Dane Cohen: Well, right, Paul's, Paul's, you know, kind of joke, but maybe not so much a joke to retailers, was, well, what happens if it's in there for a year? And his, whole joke was, you know, start a bonfire, there you go, you got your fuel. Now, Max Retail kind of takes that spot. Okay. Now, this is a question I get a lot, because people watch this, they see the 0 to 30, 0 to 60, and that doesn't necessarily mean that that is how your store is going to behave, right? There's different categories, there's different types, so like you said, retailers are gonna have a longer shelf, sorry, footwear retailers in certain categories are gonna have a longer shelf life. If you're in a, you know, outdoor store, a kayak is going to have a much different selling cycle than a Patagonia t-shirt. So, right, so this is going to look different, but it's the mentality behind it that is really the key. And for me, the mentality is those last two units, this idea that we're gonna hold on, and they're gonna sell one day. One day they will sell. And that, to me, is the mentality that has to be switched off, right? You need that cash back, and you need to put it in more productive parts of your business. Absolutely.
Melodie van der Baan: Absolutely.
Dane Cohen: It's just true.
Melodie van der Baan: 100%. And I see that, like, with footwear, that's why, you know, there's a lot of footwear retailers, and they have to abide by the MAP policies, and that can be a whole year sometimes if it's a particular model, but that doesn't mean that a footwear retailer, at least in my opinion, if they're gonna run the business as efficiently as possible, is only stocking MAP brands. That would be a recipe for challenging turnover and getting stuck with a lot of dead stock. So, we always say, if you're a footwear retailer by all means, abide by your vendor policies, tag it on Max Retail when they drop the new season, when they drop the new shoe. We are now here for your discontinued stock, really your severely aged shoes, but if you have fashion brands mixed in that assortment, don't wait on the fashion brands, because we need to make sure we're turning all the inventory we can that vendors are not enforcing policies, which is why we do really a huge business in fashion. We do a huge business in contemporary apparel, contemporary footwear, because they're putting out the collections every single month. Right? New deliveries, new deliveries, and so it's just moving very fast. But yes, I would definitely say, look at your category assortment, and your planner can help you with that. Your planner can help you make sure that you have a balanced assortment where you're not going to be forced into a 1.5 turn a year.
Dane Cohen: Yeah, and so, just to kind of level set here, when Melodie is saying your planner, she's referring to, you know, your Management One team, the kind of planning professional that's working on your team. Obviously, not all stores here today will have a planner, but it's about using the resources, right? So if you don't have a planner, but you're using Retail ORBIT, at least you're using the resources. That's for Shopify users. And, you know, Max Retail, if you don't have it as part of your cycle of inventory, you gotta get your resources in check. So, Melodie, I actually have a question, and we have some questions coming in, so I'm gonna say one first, and then we'll go to our audience.
Melodie van der Baan: Great.
Dane Cohen: Where does the product go? So who's buying the product, right? What is that, you know, what's over the hill, so to speak?
Melodie van der Baan: Sure. So, over the years, we've launched over 30 different marketplace partners, and so. Some are winners, some are losers. We've done all the hard work to figure that out. And so today, we have around 11 core e-commerce sites that we partner with. These include Poshmark, eBay, ThredUP, ShopSimon, our own channel that we launched called Snagged and Bagged, Beyond Style, which gets the inventory as far as China. Steels.com, The Climb, and one that we launched for lesser-known designers, Rack Hunt. So if it's a designer that nobody's heard of, we're doing our best to try to help it get found. Gotta say, Max Retail's bread and butter is if you've heard of it, we can sell it. Why? Because on these sites that I just mentioned. That's what people are looking for. Think about it, that it's somebody's favorite pair of jeans, and the brand stopped making them, and they wanted to go online and find them, and so they are going and searching on the internet. They don't care if it's from a resale marketplace, if it's new with tags, all they know is it's their favorite and they want it. It happens to still be sitting on a rack. It's sitting on that little wreck in Ho-Ho-Kus, New Jersey. And when that consumer finds it online and they buy it, that order comes back through Max Retail. And that retailer gets to take it off their sale rack, put it in a poly bag with our prepaid label, and they get paid as soon as that merchandise ships. And so that's what we're doing, is we're really matchmaking with everyone's favorite item from the last season that they can't find anymore with the item that's sitting on your rack or in your backstock. Hopefully not in your basement. Let's get it out of the basement and on to Max.
Dane Cohen: Out of the basement, right? That is, you don't want it collecting dust, and, you know, that's so interesting, and just to, I didn't know that about China, right? And that's so interesting, and someone from the tri-state area, New York, New Jersey, Connecticut, Ho-Ho-Kus, New Jersey, great city, great town.
Melodie van der Baan: I always say it wrong, but I always thought it was the funniest name, and so it always comes back into my head.
Dane Cohen: Driving down the highway as kids, it was always fun to see Ho-Ho-Kus. But you could have your merchandise, right, as an independent store in Topeka, Kansas, in Ho-Ho-Kus, in, you know, Walla Walla, Washington, and your merchandise could reach an audience as far as China, and there's 7 billion people in this world. First of all. I don't know how much to go towards this topic, but there's a sustainability tilt to this.
Melodie van der Baan: There is. I mean, I would say the, to me, I'm more focused on the sustainability of independent retail, and the byproduct of that is the sustainability of products themselves. But I will tell you that we had one seller in Kansas who, in one month, sold across 47 United States through Max Retail.
Dane Cohen: Wow.
Melodie van der Baan: That was cool. First of all, that he had 47 orders was cool, more than that, but that it touched that many different states.
Dane Cohen: Very cool. You're going worldwide, Melodie. Okay, we got some questions from the audience. First, we have, from our, actually, our guest from last week, Mark Denkler, how much money are some of your retailers making per month? And I think that you could shift that into, you know, wins or percentages, but, you know, what could someone expect working with.
Melodie van der Baan: I can give some concrete numbers on that. Love that. If you have a thousand square foot store. On average, you're sitting on $100,000 of financial losses a year. Okay? Now, what does that mean? This is your slower inventory that's not moving as fast, right? And so, if you list that inventory on Max Retail, I would say 1,000 square foot retailer is listing an average of $74,000 of that dead stock on Max Retail a year. In apparel, they average around $28,000 a year in payouts. So a 1,000 square foot store, $28,000 a year, if you're an apparel retailer. Again, you gotta list it for us to sell it, but that's what we see. For footwear, it's slightly higher. Footwear, it's around $47,000 a year. And the reason why is because, in apparel, if you're listing, like, skirts and things like that, everything is final sale. So it can be harder for us to sell a category like a skirt, or shorts, or swimwear. Still list them. If it's brand name, people will buy the AGOLDE shorts that they know and love. People will buy, you know, what they're comfortable with. But footwear just has a higher sell-through. Other high sell-through categories that people don't know we have is accessories. Dusty jewelry, get that listed on Max. Handbags that you've been staring at too long, they sell fast, very high sell-through, so I would say yeah, eyewear. You got leftover sunglasses from summer? We can sell those. And then there's a lot of other random things that we see listed, but those are our core categories. We have some retailers that make up to a quarter of a million dollars a year with us, because they have multiple locations. And so for each of those locations, at $47,000 a year, for each of those locations at $30,000 a year, it adds up.
Dane Cohen: And I was going to say that, and you just answered it with that quarter of million dollars that some retailers are making in a year, just like anything, there are going to be power users who believe in what you do, and don't wait, you know, that extra long cycle and, you know, hold out to the end, the power users that are using it correctly, that are being bold and taking the, you know, getting the cash back and pressing that one-click button to push it to Max Retail, I would imagine, you know, those are the retailers that are really seeing the fruits of that labor.
Melodie van der Baan: Yes, it's all about usage, because when you're listing on Max Retail, and we're getting your inventory to these sites, we have a saying, list monthly, sell weekly, list weekly, sell daily. Why? Because it's like a new arrival. In-store, when you have new arrivals, your customers come and purchase. Well, your aged inventory is a new arrival on our partner sites. And so when you list daily to weekly, you're always on their front page. You are going to have a higher sell-through and higher payouts. And if you're listing it when you're being mindful that it's not performing, then it's gonna be more seasonally relevant, and then it's gonna sell even faster. Like, I can sell your sandals last month much faster than I'm gonna be able to sell them around holiday season. Will we still sell them? Yes. Might you need to do a price drop later? But now, get them listed while it's still seasonally relevant. So we do see a lot of power users who they've just made Max Retail a part of their daily process, they move it to the sale rack, they tag it max, they get on with their lives, they get an order in, they do it again.
Dane Cohen: And we're talking a lot about dead stock here.
Melodie van der Baan: Yes.
Dane Cohen: But really, the ultimate goal of Max Retail. If you think about it, is perhaps freshness.
Melodie van der Baan: Turnover. My one word is turnover. I need my retailers to be healthy. For them to be healthy, they have to turn over their inventory. When they turn over their inventory, their customers come back and see new things more frequently. Then they can buy more inventory more frequently. I'm never gonna run out of a job to do, Dane. There's always gonna be something left over. But if my retailers have healthy turnover, then they have more money in their bank. And that's what I want for them.
Dane Cohen: Well, and that's what I hope people could walk away with, is that, again, we have, and you said I love this, markdowns can be cringey, right? Retailers have that idea that it's cringey, but the purpose of a markdown is to create turnover and freshness.
Melodie van der Baan: Correct.
Dane Cohen: So, it's, again, it's the circle of life.
Melodie van der Baan: Yeah, it's like, sometimes I just say, like, Close your eyes, plug your nose, make it go away, and like, can we learn something from it? I learned that I should never buy anything with a drawstring waist. I learned that I can never buy anything that was full length. I can only buy 3 quarters sleeve, right? I learned so much about my own store through the mistakes that I made. Mel, you can buy a print, but you know it's gonna end up on sale, so the majority of your store needs to be solid so you don't get your ass handed to you, okay? I learned a lot of lessons, and the best way to learn it is to look at that sale rack and say, where's the pattern, what do I need to do differently? So you can understand style-wise by evaluating what didn't sell, but ultimately, I'm sorry, I am going to give a shout out. Having a planner helps you understand, on a category level, what you need in stock, and that's something that the sale rack doesn't tell you.
Dane Cohen: Yeah, well, I like that there is a lot of wisdom in the sale rack. There's a lot of wisdom there if you look at it and take those, you know, learning lessons and potential mistakes so that you don't make them again, but then where to reinvest into and the right places that are fueling your business, I think that's what you're alluding to, a planner could really help support that.
Melodie van der Baan: Yeah, I love the question that was just asked. If you, if you.
Dane Cohen: Yeah, I was gonna say.
Melodie van der Baan: To mark down in 30 days? Are you training your customers to wait for sale? I think you're only moving stuff that's not performing, right? Like, stuff that's performing well, you're not moving to sale, right? You have momentum. And I think the most important thing is that you have the conviction that it's an item that needs to go to sale. And for me, the way you get that conviction is by knowing you did everything you could in those first 30 days. So, Randy, when that item came in, did we shoot it and get it up on the website? Did we make a reel about it and post it on social media? Did we feature it in an email blast? Did we call all of the customers who have previously bought that brand and invited them to come in, or did we text them a picture of it? If the answer is no to all of them, or no to half of them, then by day 30, you're absolutely right. We don't know if it's maybe the right move. Maybe it just didn't get enough exposure, but if we are giving our inventory the exposure it needs, the promotion it needs, the merchandising it needs, then at day 30, you're gonna say, okay, I now know I'm likely to be looking at this. And so, it's not necessarily training the customer to wait for sale in that instance, in my opinion, it's making sure they get out. And some customers, Randy, are just gonna be sale customers. That's who they are. Right? They will not buy anything in your store unless it's sale.
Dane Cohen: You need that sale customer. That's okay. And listen, again, and I think we've said this, there's different types of product, different types of categories, different types of retailers, that 0 to 30 timeline may not work for certain types of retailers, types of product. The key here is that 30 days should flag in your head. You know, you should be looking, and if, listen, if you have, like, a 10% sell-through, even if that tells you, I gotta do something about this, I gotta do what Melodie said, and exhaust all my, you know, marketing and e-com and social media before I can say that, you know, hey, we tried it. Okay, we have some questions from the audience. Teresa has a double question. Do you have a list of the e-com sites that Max Retail posts the goods on to sell? I think you named some of them. And then her follow-up question was, is the retailer listed as the seller on these sites, or is Max Retail listed as, Max Retail listed as the seller?
Melodie van der Baan: So, I love that question, Teresa, and I have to tell you, when I first started working on this business in 2016, the first thing I did was call the retailers that I used to sell to when I was a rep. And that's, that's how I built this business, was by listening to their feedback. And the number one thing that all of my retailer friends said was, I don't want to be associated with my past season goods, right? I don't want my name anywhere. And I really took that to heart. That has always been a core pillar of Max Retail, that it is an anonymous platform for your dead stock and past season inventory. So, when you sell on Max Retail, you're going to list it on our platform, there is no attachment to your store, your inventory just becomes a piece of inventory in our network. So let's say you list a pair of Levi's jeans, right? And let's say there's another retailer who lists a pair of Levi's and another. You're all three in different states, you have different sizes available, but you're sitting on the same boot-cut pant. It's all gonna get grouped together.
Dane Cohen: Yes.
Melodie van der Baan: As one listing, it's just that Levi's boot cut. And when we distribute these data feeds to our partner sites, and someone purchases a size 28, right? The retailer that has the 28, the order's gonna come through, and that retailer's gonna get the sale, drop ship it, they're gonna ship the merchandise in a non-branded polybag, no store merchandising, all sales are final, the address on the return label is ours, not yours, so if there is a problem, an issue, or a return request, it's coming to us. Not you, and the merchandise is gonna go directly to them. But let's say someone had ordered a 26. If that order comes through, it's going to go to the other retailer. So you can see that you're essentially acting as a fulfillment partner, right? But no association to your exact store, so it's a very quiet way to dispel the dead stock.
Dane Cohen: Yeah, and I think that this is something that a lot of consumers are just getting comfortable with. You know, product is coming from all different places, you know, you're buying on, you know, some of these larger sites, like, you know, Target and Amazon, and they're using resellers, so I think people are just so used to that end product just coming from, and again, that anonymized, you know, that it's not, you know, packaged in the retailer's packaging, I think that is important. Okay, Butch asks, do you work with men's stores?
Melodie van der Baan: I sure do, Butch! We work with lots of men's stores, and I don't have enough men's inventory, so the more I can get my hands on, the more we can sell.
Dane Cohen: Alright, that's awesome. And then, another question, is there an argument that if you put merch on sale after 30 days, that you eventually train your customers to wait for the sale? I think, yes, we answered that.
Melodie van der Baan: Yeah, that was a good topic. And believe me, guys, like, I get it. And I'm sure there's some things that, if I still had my store, I did sell my store in 2021 to a wonderful woman, I do think if I would have had my store, there would definitely be some brands that I probably wouldn't mark down in store, and I'd probably just put them on max. So, like, if I'm gonna be dead honest. There's definitely some brands I wouldn't want my customers to see on sale locally.
Dane Cohen: Interesting. Okay.
Melodie van der Baan: Marie!
Dane Cohen: I get that. So you're saying some of your banner name brands, you don't want the customer associating with any type of markdown with your store, so that's a good.
Melodie van der Baan: I don't care if I sell it to someone in Georgia, I don't care if someone in Alaska, I just don't want someone in Palm Beach Gardens who always buys it from me. So, I mean, Randy, there you go. Like, but if I promoted it to High Heaven, and my local customers really don't want it, the odds of them buying it on sale are just as bad, because I already promoted it to high heaven. So that's, I think, why, for me guys, like, the very first step is just doing right by your inventory the very first day it comes in store. Exhaust all your efforts on your full-price merchandise. Don't wait and exhaust effort later.
Dane Cohen: Right, and I think that the, you know, this is the interesting part, is I know we're focusing a lot on the back end of the process, but the goal is to sell down at full price as much as possible. You know, we just know the reality of what end-of-season merchandise looks like, and once you know that reality, having a resource, having solutions. Fantastic. Okay, let's move on to something that you said to me before this.
Melodie van der Baan: Dane, we just had one question that came.
Dane Cohen: Yeah.
Melodie van der Baan: Here we go. If a brand doesn't want to list on eBay, can you exclude it? Absolutely. So, we allocate by brand, category, and price point to channels. Right? And then also, based on how good of a fulfillment partner a retailer is. So, the more orders you approve on Max Retail, the more sales channel access you get. So, for instance, when you start on Max Retail, you're not gonna get eBay and ThredUP instantly. You have to approve all your orders for 30 days, show us that you're not gonna be declining orders, and then you unlock even more channels, even more sales. But that said, there are certain brands. We do not put on certain channels, because it's the brand's preference. We work with brands as closely as we can if we have a relationship with them, to understand where they do and don't want their products, so that we can be aligned with them.
Dane Cohen: Yeah, so another question in that vein was, how do you, maintain brands' minimum advertised price?
Melodie van der Baan: So, we ask retailers to not list MAP products until they're off-MAP. If we get word from a brand that a MAP product is being listed, we will deactivate it on our site. We have certain brands that partner with us, and they give us their MAP pricing so that we will know when a retailer is violating the schedule. So, to the best of our abilities, but we do have 20,000 brands on Max Retail. It is very hard to police, and we do count on our retailers to follow their vendors' policies, so that we don't get in trouble on the side of things. And then Mel's on the phone, talking to this brand and that brand, but ultimately, it ends up in a partnership 9 times out of 10. And we try to just be friend of retailer, friend of brand, friend of earth.
Dane Cohen: Yeah, and I think that is really important, that you're protecting both the retailer and the vendor.
Melodie van der Baan: We never give up any names. If someone's like, who's listing my MAP products? I'm like, can't tell ya. Got a legally binding agreement, but why don't you tell me what's on MAP, and I will take it off our site. So I, you know, guys, we're human at the end of the day, and we're doing the best we can, but I'm always gonna stand behind the retailer, and I'm gonna try to figure out how to serve them the best.
Dane Cohen: They're at the end of the food chain. They're at the end of the food chain.
Melodie van der Baan: Brands need retailers to be successful. Every time a retailer goes out of business, they lose that book of business. They need retailers to win. And so I just sit in the middle here, and I try to explain that, and say, so, do you take it back? If this retailer can't sell it, do you want it back? Right? And they say, no, I don't want it back. I say, alright, well then let's figure this out together.
Dane Cohen: They should take it back and list it on Max Retail.
Melodie van der Baan: And they should just, they should just not be.
Dane Cohen: Yes. No, everyone's gotta work together. Okay, do you work with dance retail stores?
Melodie van der Baan: Again, it's if it's brand name. So, if it's, like a hot brand for dancewear, hey, it could be trending on Poshmark and eBay. I could absolutely see that. If it's a no-name brand, probably not.
Dane Cohen: So, in general, like, no name, like, you know, no name brand, even if you have, like, a private label, is that something that's, so we're really sticking towards those known name brands, because something like a Gilt, right, that may be one of the end channels that Max sells to. They're looking for those brand names that can get the customers.
Melodie van der Baan: People are generally looking for brand name everywhere. Our core customer, I like to describe them as the big thing in their small town. And I think a perfect example of this is I went to Rockwall, Texas last month, and I shopped 8 boutiques in a 2 block by 2 block radius, and it was some of the best shopping of my life. I was blown away. Right? Small town, suburb of Dallas. And the point that I'm making is they had all the best brands. I mean, I picked up Beach Riot, I picked up Z Supply, I got myself a super cute... what else did I get? FRAME jeans. Okay, my husband was like, is this necessary? I'm like, research and development. But my point is, that's our core customer. They carry the best brands, it is their curation. And you just don't sell through absolutely everything. But Max can sell those leftovers, and so a couple of those retailers on the street do sell with us, which is really fun to say, like, wow, this is your store, and they're like, yep, just had a sale this morning, yep, had two yesterday, and so it just feels really good to see the vibe of the store, see their incredible merchandising, see what makes them them, and know that we're there for the leftovers. It was really special.
Dane Cohen: Well, I'm sure your husband said, why couldn't you have bought some stuff on Snagged and Bagged?
Melodie van der Baan: No, if I'm going in a store, I'm gonna shop the full price, I'm gonna shop the sale rack, I just... I can't get enough. I can't get enough.
Dane Cohen: Well, and that's another thing, and even me personally, right? We contain multitudes. We want to buy full-price freshness, and we want to get a deal sometimes, right? Yeah, you want to be ahead of the trend on some things, and then you walk into a store and something's great, or you find something on, you know, an off-price retail site, and you could be both people. You don't have to be boxed into one. And, by the way, the off-price retail business is on fire right now. When we look at what's happening with TJX and, you know, their roster of stores and the online off-price businesses, you know, it's a good time to be connected with them because they have such a tremendous growing customer base. So again, it kind of fuels this food chain even more.
Melodie van der Baan: And I think it makes us as retailers ask what is the experience I'm delivering? That keeps people coming back frequently. And experience is not just about how you treat them when they walk in, but what they see every time they walk in. And so, that freshness can never be understated. Every single time the customer walks in, they must see something new and exciting. That is what's going to keep them buying from you, okay? If they walk into your store and they can't find what they're looking for, they're gonna go somewhere else. That's why you need to have the right product at the right time, at the right price. To sell fast.
Dane Cohen: Yeah, and speaking of, I know we've spoken a lot about the life cycle of inventory, but this is why we are such great partners, because we want to invest in the right inventory at the right time, we know we want it to turn over as quickly as possible, we know there's going to be, you know, slow movers and dogs, and then we want those to get on a markdown cycle, and then we want the retailer to have that end-of-the-road resource, which is Max Retail, and then it all starts again. It all starts again. So we have one more question, and then I know we have to wrap up here. Unfortunately, I mean, Melodie and I could go all day.
Melodie van der Baan: We could talk for days, Dane.
Dane Cohen: Yes, and then what is the criteria to list on Max Retail? If any, do you have to have a certain amount of stock to sell on Max Retail?
Melodie van der Baan: So, we suggest that you list at least $6,000 to start, and the reason why is because you want to think about, like, when you're stocking your store, right? Like, if you go to a store and you only had, like, $1,000 worth of inventory, like, how much are you really gonna sell? And so, think of it, random onesies, twosies, the last one here, the last one there. It adds up, believe me, okay? But at least 6,000, 10,000's really the sweet spot. I would say the majority retailers come on listing 20,000 initially, and then we ask that you approve orders. We need you to be a good fulfillment partner, because we work really hard to establish these relationships with these sales channels, and we are acting as 4,000 retailers altogether, on an individual account. Right? And so, if all of my 4,000 sellers declined an order, we would not have these relationships. And so, that is our ask, is that if you're gonna list something, that you have it available to sell, and that you're going to approve it. The more orders you approve, the more channels you get, that's what it looks like. And then to answer your question about integration, today we integrate with Shopify. Lightspeed R-Series, Square, Ricks, and Imagine. So if you're on any of those point of sales, otherwise, it's as easy as sending us an on-hand report with basic pieces of information, and our team can go ahead and list your products that way.
Dane Cohen: Guys, I promise you, when I saw that Shopify, and I'm not trying to browse.
Melodie van der Baan: No, you could be up and selling in 15 minutes.
Dane Cohen: On any of.
Melodie van der Baan: Those integrations, it's lickety-split.
Dane Cohen: Ugh, because I, listen, retailers, you know, there's a lot on their plates right now, and so this quick solution is really incredible. Okay, well, Melodie. Thank you for being such an advocate for the independent retailers out there. You were one, it's in your blood, it's in your spirit, and, you know, you've really made a tremendous difference. Is there anything you want to leave us with as we conclude this awesome conversation?
Melodie van der Baan: I would say, just a word of encouragement. I know a lot of times retailers can feel lonely, and I'm so glad that everyone here is a part of communities. If you're a footwear retailer and you're part of the NSRA, if you're working with a planner or Management One, you're here. If you're part of Max Retail's community, I know it can feel lonely, and I know it can feel ambiguous. And sometimes discouraging, but if you serve your customer well, you will never lose. You will never fail. Just define for yourself what serving your customer well looks like, right? How do they feel when they enter your store? Are they seeing value when they enter in the product, in the service? Are you keeping yourself well engaged with them? Are you clienteling? Now more than ever, you must stay connected to your customers. Have that personal relationship with them. Right? I can tell you that it is the personal relationship that makes me drive to the store and buy new baby clothes versus order them on Amazon. It is my love for the local retailer and wanting them to win, so make sure that when you are loving on your customers that your staff is loving on your customers, that there is a process in place to deliver the consistency. And I know that has nothing to do with inventory, Dane, but at the end of the day, it is our people that keep us in business, and there's a lot of competition out there, and I acknowledge that. Absolutely. They will stay with you, they will make the effort, and you are the ultimate curator. You are the ultimate influencer. I don't care what's going on online, there's no one like you, and that is why you exist.
Dane Cohen: Love it. Well, Melodie, we see in the chat, people are thanking you. I thank you for being here. We'll both be, if you want to catch us, we'll both be at Coterie in New York. We'll be walking the show, and then Day 3, we're both speaking. I think we're back-to-back, so that'll be fun. An inventory overload! And Melodie, thank you so much. If you want to get in touch with Max Retail, or learn how you can post, we will put the link on our YouTube. I think, I think the kids say link below, and it's right here in the chat, if anyone, if anyone wants to, you know, just, you know, schedule some time with Melodie, her team, and learn more about Max Retail. Alright, Melodie, I will see you at Coterie and Magic New York.
Melodie van der Baan: See you in New York. Keep on keepin' on, retailers! Bye!
Dane Cohen: Alright.