Moving into 2010, most retail economists are predicting a continuation of the “do more with less” retail buying strategy. This will mean high fill rates, accurate forecasting, and proactive out of stock analysis will be critically important to maximizing sales.
I would like to begin a discussion on the best practices for getting a replenishment manager to act on a SKU forecast recommendation. Here are a couple thoughts to get the conversation going.
- Carefully analyze fill rates and ensure all orders are completed on a timely basis before approaching the buyer with a forecast recommendation. It’s basic ‘blocking and tackling’, but if your fill rate is below expectations, the buyer is not likely to accept a recommendation for more inventory.
- Whenever possible, use actual comp period historical sales demand as the basis for forecasting current year sales. Conservative forecasts built on actual sales history have higher credibility and less chance of error.
- Concentrate your analysis on A stores and position your recommendations to the buyer on 100 or 200 ‘test stores’ to start.
- Carefully document the ‘before’ and ‘after’ performance so when you go back recommending an expansion beyond the test stores, you have a positive business case.
Please chime in and add your thoughts and experiences.