It is one of your most significant areas of investment. So are you following these crucial stock management practices?
Effective inventory management is a skill, but it is also a group of processes that could be streamlined by simply using the correct tools and methodologies. Keep reading for our top tips on the best way best to manage inventory efficiently within your retail enterprise.
Drive your choices through the Correct reports, not hunches
Do you know for a fact which goods are under and over stocked across every one of your stores? Are you confident where categories are selling? Having real time reports and dashboards that enable you obtain visibility, unveil blind-spots and create data-driven decisions is a vital element of mastering how to control inventory on your retail store.
Unify your stock data
There are untold benefits from incorporating inventory control procedures across your eCommerce and bricks and mortar store(s). With an accurate, holistic business-wide perspective that factors in stock on hand, laybys and rear orders in real time is the basis of stock management. Without this, the rest of the procedures discussed under challenging and duplicative.
Configure your data structure properly
It’s vital that you’re ready to break-down your inventory data into detailed categories and sub-categories. Therefore, if you are in the fashion business, rather than have a class just for black dresses, you would break your black dress into several sub-categories such as Mini Black Dresses, Short Black Dresses, Mid Black Dresses and Long Black Dresses.
This enables you to perform complex searches, stocktake by category and obtain high-level insights about particular product lines and sorts. You could also use this information to power your incorporated webstore to create the user experience easier for your clients.
Use your ABCs to prioritise your attention
1 invaluable facet to optimising your stock would be to assign specific products with priority levels through the use of ABC analysis. For Instance,
- ‘A’ products are the greatest value products — they generally drive 80 percent of gross margin/revenue, but constitute 20% of your stock portfolio.
- ‘B’ products are moderate value products — around 15 percent of gross margin/revenue, but constitute 30% of your stock portfolio.
- ‘C’ products are low value products — approximately 5 percent of gross margin/revenue, but constitute 50% of your stock portfolio.
As soon as you have these goods identified, it is going to enable you to set appropriate order amounts and frequencies, pricing/margin strategies and marketing & promotional programs.
Perfect your stocktake measures
Regular stocktakes have a large number of advantages: they explain your profit margin, help to identify slow moving inventory to concentrate on, reduce reliance on back orders and emphasize any poor practices or theft before they become a larger problem.
Stocktake is a process seen by many retailers as a necessary evil, but it doesn’t actually have to be painful. Apart from using a centralised database to streamline the procedure, be sure to:
- Digitise your stocktake process utilizing barcode scanners and POS applications
- Break stocktake into less daunting bite-sized segments — called’cycle counts’
- Develop a stocktake strategy so employees are not doubling up on regions, and
- Have a cross-check method set up inside your system to banish any errors.
See the 5 stage stocktake check to make certain you’re putting your best foot forward.
Act insights into purchases and providers
As soon as you’ve your real time inventory data clearly available you’ll also have the ability to drill down into which of your providers are delivering on time and providing the best prices — and which aren’t. Arming yourself with this knowledge lets you negotiate with suppliers employing accurate data-based evidence to increase your margins and fulfilment performance.
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