Category: Business

Effective Techniques of Inventory Management for Retailers for Better Experience - Indian Sleep Products Federation | Indian Mattress industry Understand the outputs to know how to adjust the inputs. Inventory Management is key to a retail store. Whether you are an online store or a physical experience outlet, if you are showing what’s new to your customers, they move far and away. The retail business thrives on newness. If your customers who walk in see the same old stock, time and again, they will get bored and will prefer a store where stocks are always on the move. The art of having the right products in the right quantity for sale, at the right time is called inventory management. It is a part of the larger supply chain management. If done effectively, retail businesses can avoid carrying excess inventory and hence reduce inventory A FEW TIPS TO MANAGE INVENTORY BETTER Fine-tune Forecasting: Planning too aggressively can have disastrous effects on profits. Your projected sales calculations should be based on factors such as historical sales figures, market trends, predicted growth and the economy, promotions, marketing efforts, etc. Answer the question of ‘Who is taking the risk’? If you are taking the risk then be conservative on your sales forecast. It is okay to be aggressive if your supplier is taking the risk. Use the FIFO approach (first in, first out): Goods tends to be around if you do not prioritize to push it out. Goods should be sold in the same order as they were bought or created. This is especially important for sleeping products. This approach is called FIFO method which stands for First In First Out. The best way to apply FIFO in a storeroom or warehouse is to add new items from the back so the older products are at the front. Identify the low-turn stock: If you have stock that hasn’t sold at all in the last six to 12 months, it’s probably time to stop stocking that item. You might also consider different strategies for getting rid of that stock — like markdowns or special promotion — just get rid of old stock. Track your stock levels at all times: Have a solid system in place for tracking your stock levels, prioritizing the most expensive products. Effective software saves you time and money by doing much of the heavy-lifting for you. Don’t forget quality control: No matter what your specialty, it’s important to ensure that all your products look great and are in saleable condition. Set Stocking up versus sales Benchmarks: Do this by Category and against the best player in that category. Benchmarks should not be on your own best periods. Always prefer selling unsold, old stock to your own customers at a bargain price to that of returning it back to the supplier. The former gains you happy customers and the latter gains you unhappy suppliers. Consider drop shipping: Let your supplier into your business like a partner does. Amazon does this effectively. A wholesaler or manufacturer is responsible for carrying the inventory and shipping the products when a consumer buys from your store.