Inventory management isn’t exciting. You don’t get the ecstasy of interacting with your customers or the pleasure of setting up marketing resources for the fresh brand you rolled out. You might even consider inventory management last thing on your priority list.
Many retailers are resigned to late nights streamlining evaluation processes and sorting heaps of purchase orders and sales reports. But remember, inventory can make or break your business.– In fact, some tools can help you optimize retail inventory, as well as some other essential aspects of your company, and demand retail is one of them. If you do it successfully, it will absolutely make you run your business in a cost-effective way.
Walmart itself lost a reported $3 billion in 2013 when it encountered persistent stock outs. Imagine the ramifications for a brand with a less stable financial footing. Keeping in mind the importance of inventory management, below are seven tips to help you improve your inventory management process efficiently.
Predict demand
Excessive inventory kills cash flow, and that’s why retailers go out of business. To avoid this, you should be good at predicting demand as it will assist you in refreshing your inventory.
A retailer needs to ensure its inventory covers the right amount of the right products to satisfy customer demands. Additionally, updating your stock with the right products on a regular basis help you to get rid of expired or damaged stock and keep you organized.
Refreshing your inventory should be your number one priority as it reduces the chances of going out of stock, while at the same time avoiding piling up of any commodity in excess.
Use inventory management software
Technology is evolving rapidly, and cloud-based software solutions are gaining massive popularity in the current environment.
Using an appropriate inventory management system like Fishbowl, Agiliron, TRXio, etc. helps you streamline your evaluation processes by automatically updating your inventory information based on both product sales and purchase orders.
Adopt a hawkeyed view on POS analytics
Do you know your best selling products? Do they have seasonality? Do particular products perform better when you place them near other products? Do you have other store branches that perform well?
Make the use of point of sale (POS) analytic system appropriately to get the answer to all these questions.
POS analytics not only help you to track inventory levels and alert you on orders, but also assist you with evaluating the performance of each product. POS analytics show you what you should stock and which items aren’t worthy.
Recruit the best – and most trustworthy – employees
Hiring skilled employees helps to increase the efficiency and productivity of your business. But remember, while conducting background checks of candidates appropriately, as retail stores are especially vulnerable to employee-caused inventory shrink, including, employee theft.
According to a survey of the US Retail Fraud, retailers lost $60 billion in shrinkage in 2015. What was the biggest reason for their losses? Their employees!
Of all the root causes of inventory shrink, 38 percent is reported as “employee theft.” All retail shrink interrupts a retailer’s inventory management effectiveness, and theft is indeed no exception in this regard.
Label boxes and shelves
The major problem new customers face the moment they enter a retail store is searching and finding for the products they want. Some customers are very particular about their time, and they won’t put in much effort into exploring the product. If your shelves and racks are not labeled, your shoppers might find it difficult to locate things. This can cost them time, and they may not come back again.
Losing customers is the worst nightmare for every business owner. You can retain your customers by arranging your stock in an orderly manner by labeling your shelves, racks, tables, and boxes with bright, clear, concise signage. Though this process is time-consuming, it will improve your customers’ shopping experience.
Use barcode and inventory scanners
Using inventory scanners saves you a lot of time. Inventory scanners and barcode scanners are used to read information about a product embedded in the form of barcodes, including price, date of manufacture, expiration date, etc.
A barcode scanner captures these details faster and helps you in the billing process. It also enables you to identify any product that has reached or is about to enter its expiration date, giving you enough time to eliminate it.
Keep records of your finances
Retail accounting is critical when it comes to running your store successfully and obviously; no one wants to lose their business because of poor accounting skills and practices.
If you are not aware of how accounting works, you can enlist the help of accounting firms providing retail accounting services, or you can hire accountants who are experts in accounting for retail stores. They will help you in maintaining your books and finances, allowing you to work on other core aspects of your business.
Conclusion
Use the seven tips above to improve your inventory management and enhance the shopping experience of your customers. Investing the time to make your retail inventory processes seamless pays off in better serving your shoppers, ensuring they come back to your store to fulfill their needs.
