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Good retail inventory management maximizes profits and eliminates waste. Hiring an organized team, creating efficient processes, and integrating auditing are key. Accurate sales and order records help reduce waste and predict inventory needs. Regular reviews and making inventory counting fun can also help.
Counting, organizing, and managing inventory is unlikely to be every worker’s favorite job; however, good retail inventory management helps maximize profits and eliminate waste. There are several basic things a good owner or manager can do to improve retail inventory management, including hiring a great team, creating efficient processes, and integrating auditing.
Retail inventory refers to everything in a store for sale. This distinguishes it from retail assets, which may include items such as shelving, store computers, and premises value. Most retail stores make a profit by buying or manufacturing merchandise and selling it at a higher price. A streamlined retail inventory management process lets the owner or manger know what goods the store has and therefore its potential profit margin.
One of the keys to managing retail inventory is hiring inventory managers with a knack for organization. Some people just have the right kind of intellect to handle the big picture of orders and restocking, as well as the little details like return policies and stock counts. If you’re hiring within the company, look for candidates who have a mind for math and statistics and who are good at logical thinking. While retail inventory management may require at least some work from all employees, having a truly organized person in charge can make all the difference in the process.
Keeping sales and order records in order is extremely important to good retail inventory management. Using records of past sales, an inventory manager may be able to accurately predict when new inventory needs to be ordered, how likely it is to sell in a given time period, and what the likelihood is that all inventory will be sold before maturity. With this data, inventory management can help reduce waste by eliminating overorders, without risking customer satisfaction by running out of a particular product. Without accurate and regular sales and ordering data, inventory management can quickly turn into a wasteful guessing game.
While many retail stores can accurately predict their intake and production, markets change over time. Hot product that wouldn’t stay on shelves one year could be out of date and irremovable the next, making it important to create a regular review for inventory purposes. If an inventory manager has good, up-to-date information about what he sells, he can better predict how to sort and organize inventory.
A dreaded part of working in retail is pulling your entire workforce along to help with inventory counting and replenishment. Try and try to make this process more fun by turning it into a corporate event rather than a group drag. Maintain inventory after hours and provide workers with snacks and fun music to make the hours go faster. Some retail stores even turn inventory checks into a competition between departments or teams, with prizes for high accuracy or fast counting.
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