While there’s a number of different types of inventory management you can focus on, today is all about retail inventory management.
Retail inventory management is not “attractive” or “fun,” but you can bet your bottom dollar that it’s a key component to the success or failure of your business.
We still remember when Walmart lost $3 billion dollars in 2013 because they were always out of stock. 99 percent of the retail businesses out there could never do that and survive.
Long story short, if you can’t effectively manage your inventory, you’re sure to lose revenue and it may be just enough to put you out of business. You don’t want that, we don’t want it for you, so we’re going to cover several critical steps you can implement to ensure inventory management is never the downfall of your business. Let’s go!
(1) Reduce Product Range
If you’re carrying too many products that are not selling, it’s time to do something with them.
You already know that too much inventory is a bad thing, it increases the cost of inventory, you may have inventory holding costs to consider, it’s never a good idea to keep something that’s not selling.
Rather, we want to increase space for products that are selling. Full shelves don’t do you any favors if they haven’t moved in a year. You can cut and slash your inventory cost quickly by getting rid of products that don’t sell, so do it!
(2) Reducing Your Lead Time
You do have the ability to prevent stockouts by focusing some of your time implementing lead time reduction strategies.
When stock arrives fast, you don’t have to worry about your customers waiting long periods at a time to fulfill their orders. Customers are always priority one and they’re going to be a lot happier for it.
(3) Optimizing Inventory Receiving
Every part of the inventory management process is important, so why not start when stock first arrives?
Efficient inventory receiving begins with a clean, ordered staging area and products getting to where they need to be as quickly as possible.
From there, we leverage inventory receiving technology to automate the process and reduce errors. Warehouse managers and staff should never wonder where products need to go.
(4) Improve Inventory Turnover
A high inventory turnover rate makes retail inventory management so much more easier and efficient.
The more inventory leaving the warehouse, the less inventory needed to be managed, that’s what you want to aim for.
A high inventory turnover ratio also means product is coming off the shelves, which can ultimately reduce your inventory costs.
(5) Forecasting Demand
You need to have the tools and resources to forecast demand. This is one of many ways Accelerated Analytics can help you. Thanks to the POS data our reports can generate, you can see your sales numbers across all your stores to see what products are in demand and which are not.
Your past sales data and analytics is invaluable, so make sure you’re using them.
Our POS reporting gives you all the sales data you need to forecast as much as you want.
(6) Building The Right Team
The biggest assets your company has is your employees. You need to make sure you’re hiring a team that believes in your mission and goals.
Employee theft is a huge problem and while you can’t stop them all, you can do things to curb the likelihood of it happening to you.
- Do credit checks
- Do background checks
- Investigate past employers
- Security features
(7) Consistent Stocktaking Process
While you don’t hear a lot about stocktaking, you want a consistent stocktaking process that is effective, efficient and error free.
The big thing stocktaking helps with is identify problems before they get out of hand. It can also help inform your ordering and stocking decisions, as well as helping you forecast demand.
Unfortunately, we see a lot of retail companies using outdated inventory management systems, like Excel for example.
Technology can be a huge ally for your retail company, make sure you’re staying current on the technology front.
(8) Loss Prevention
It doesn’t matter how big or how small your retail business is, someone is going to steal from you.
You can utilize loss prevention tags to avoid this. Sure, it’s an investment now but it’s going to save you money. Once criminals know where they can steal from, they’ll come back again and again and again.
Prevention tags protects your business, don’t do without them.
(9) Use Inventory Management Software
A cloud-based inventory management system is the way to go. This tech is going to streamline everything in your inventory management.
With 2020 nearly here, you shouldn’t be doing anything by hand.
The right inventory management software can be a game changer, so make sure you’re investing in a solution that works for you.h
*Accelerated Analytics publishes resources like this to provide insights to different analytical metrics, data points and formulas. POS Analytics. Please be aware, this doesn’t mean that our product will this metric, data point or formula. To learn exactly what our reporting covers, please feel free to schedule a demo or give us a call. Thanks for understanding.