When running and eCommerce store you will encounter products which become discontinued. Many stores will just delete the product/category from their website. While this is fine, there are better ways to handle discontinued products.
Over the past couple of years, I have been testing various ways to discontinue products.
One method is to redirect the product/category to another product/category from the range or brand. If this is not possible you may want to redirect to a similar product/category. This functionality is not always built into eCommerce platforms. For Magento, I would recommend using Creare SEO. This module gives you plenty of functionality and makes it easy discontinue a product by just selecting where you want the product to redirect to on the product in your backend.
An alternative would be to delete the product and use URL Rewrite Management in Magento to set up a new redirect. This is very time-consuming but keeps your product list very clean.
Another method is to leave the page on your website and show a notice to the customer stating the product is now discontinued. Removing the product from any categories is also recommended to ensure that customers do not easily find the product mixed in with your current stock.
This method allows you to bring the item back in time if you find an alternative supplier or you find demand is high for it.
I would recommend this method if you have a large catalogue and removing products is not efficient. I am currently using both methods on two websites and it works so much better than just deleting the product and leaving a 404 page behind. I would highly recommend putting processes in place and ensure that you receive the correct information.