If you’re in retail, then your products are the core of your business. But successful management of your products isn’t just about picking what items appeal to customers. You also have to consider how you manage that inventory. How you store it, how much you have at any given moment, how you make it easier for your employees to work with. The tips below are going to maximize efficiency, improve products, and make sure you’re getting every penny you can from every piece of stock.
Keep re-evaluating your supplier relationships
Managing good relationships with your suppliers is crucial. Don’t just go for the first one that’s available. Measure them not just by pricing, but by convenience, how close they are, and even the ease involved in their own supply chain. Get to know not just your supplier but their competitors and their suppliers. That way, if they have any problems with their own inventory, you can quickly identify alternatives and mitigate the damage done to your own profits. If you can, you want to manage a long-term relationship with one supplier. When suppliers deal with long-term clients, they’re a lot more likely to offer better deals in order to retain you and ensure your repeat business.
Remove the human error
It’s an anomaly in today’s retail environment, but there are still a lot of smaller stores just using simple human effort, pen, and paper, to track inventory details such as stock amounts, prices, and which products go where. These same small businesses probably wonder why they’re not profiting enough to grow. The more you remove human error from the equation, the more reliable and consistent the data you get from your stock is going to be. Tools like pricing guns from www.AmericanPriceMark.com don’t just help you price goods. They help you more quickly identify out-of-stock goods and track them, too. Not only does using them mean you’re less likely to put goods on the floor that you shouldn’t, but it makes the work much easier for your employees which then makes them more productive.
Know where every piece is
Of course, the tools that you use with your inventory only work as well as they can if they have the corresponding system to keep track of all the data. With software packages like www.InFlowInventory.com, you are going to be fully aware of where every piece of your stock is and have access to all that data on one screen alone. You can see what’s out on the shop floor, what’s in the back, what’s about to go out of date, and so on. You’ll start missing fewer products, know when to move things to clearance, and know when to make a repeat order. That way you’re losing as little due to unused and discarded inventory as possible.
Stop losing it
A product going out-of-date isn’t the only risk of loss in the business as you well know. There are other forms of shrinkage that might eat more deeply into your profits including theft. You need a comprehensive shrinkage reduction strategy. This includes security policies like only allowing employees with higher levels of access to the stock room or installing CCTV cameras. Prevent shoplifting by training employees and managers, in particular, in awareness. Increasing the level of customer service has also been shown to reduce the rate of shoplifting. If you’re suffering high rates of loss, vendor employees such as delivery men might also be a culprit. When you’re receiving stock, make sure that you have someone there, if not yourself personally, to survey.
Learn from it
Back to a more positive tone on inventory management. If you’re using an inventory software system to keep track of it all, then there’s a lot that you can learn from inventory, too. Data analysis is fast becoming a big part of creating profitable strategies in the business. In particular, keep track of how well or how poorly individual items sell. You can use this to identify trends, as well as decreasing trends that could benefit from a sale. You can also start to identify seasonal ups-and-downs in your products. This can impact not just how much of a certain product you stock, but also things like visual merchandising and what deals you should offer next.
Get just as much as you need
As mentioned, however, you should be using that data to figure out how much of a product you need first and foremost. Many retailers think that the only danger in mismanaging stock levels is ordering too little. But as www.AccountingCoach.com states, every piece of inventory you stock costs you money. It costs you even more if you have to refrigerate it or take extra measures to make sure the goods don’t spoil. Using the data mentioned above, form more accurate anticipations of how much you need and consider even being more conservative. At the same time, you can automate your inventory system to alert you when you’ve hit a set minimum stock level and are in need of a resupply.
Don’t forget to audit
Many of the issues above can be solved with the right tech, but you shouldn’t completely neglect the importance of taking a double check. Auditing your inventory is essential in some businesses for tax purposes. Even if it isn’t in yours, it can still help you better identify which issues are most prevalent in your business. Whether it’s stock being stolen or lost through shrinkage or mismanagement of the storeroom, a bi-yearly audit is going to help you much better understand which strategies to use next to tackle those issues. Many companies also outsource their auditing to make sure that they’re getting access to the latest equipment providing the most accurate results.
Managing inventory is complicated, but it’s worth putting the effort in. Take a lax approach to loss, to missing items, to overstocking and understocking and you’re going to run into a lot of wasted money and inefficiencies that make the stockroom a nightmare for your employees.