Best practices for managing inventory in your pet supply shop
December 30, 2019
In addition to providing pet parents with stellar service with a smile and a great shopping experience, you want to provide what the customer wants most: Getting their hands on the pet supplies they want and need. Maintaining inventory isn’t difficult, but to optimize profits and the customer experience, you need to commit yourself to finding that balance between efficiency and pleasing your customers. An overly focused approach on efficiency, for example, disappoints people and eventually teaches them to look elsewhere to find what they need.
Excess inventory, on the other hand, leads to waste and will increase your carrying costs — something you can ill afford in this competitive market. Finding that perfect inventory fulcrum isn’t one and done, it’s ongoing and continuous. The good news is, making inventory management a focus can put you a step ahead of the competition. Some 43% of small businesses do not track inventory at all, or else they rely on manual, paper-based processes. Use the following best practices to help you achieve your goals and make your pet supply business more efficient.
The easiest way to optimize your inventory processes is investing in a modern system that automates it for you. An end-to-end point of sale system (POS) can update your inventory records in seconds, eliminating those time-consuming paper processes that can consume hours during a busy week.
A POS system can give you at-a-glance, real-time sales and product performance. You can also set it to monitor your inventory, so when you’re running low, it can either trigger an order (or prompt you to initiate one). Over time, you can use the data to forecast the needs of your store. Even if your business is small, or just starting up, automated inventory gives you that scalable solution that minimizes errors and sets you up to keep the customers happy and satisfied with every visit.
Put someone in charge of inventory management
Even with automation, it’s well worth the time and resources to designate one manager to take charge of the stock room and manage everything related to inventory. Even if it ends up being a part-time duty (with time on the sales floor built into the schedule), taking this step can pay off in improved profits and less waste.
Share data with suppliers
Single out the sales data that pertains to a supplier’s slate of products and pass along those numbers. Because you have shared goals of boosting sales, putting this information into the hands of your suppliers can kick off a helpful conversation. The data may tell you that the timing’s right to introduce a new product line. Or maybe a spike in returns gives them the hard data they need to help them figure out what’s interfering with quality. They’ll also know what’s trending with your competitors, and can pass along suggestions based on the data.
Follow the 10% rule
Analyze your sales, see what’s moving and which items are just failing to launch. By trimming the bottom 10% of performers across the store, you can make room for products that can, potentially, increase your profits. That said, just about every retailer has exceptions for this rule, simply because the product is rarely purchased but essential for pet parents. In that case, explore alternatives. For example, would it make sense to sell the essential underperformers seasonally?
You don’t want careless handling to prevent the first-received products from ever making it to the floor. Even if the products have a long shelf life, dust, scuff marks, or even out-of-date packaging can signal to customers that a product isn’t the freshest available, and dissuade them from buying from you. Yet, when employees are in a hurry to restock an empty shelf on a brisk sales day, grabbing the right stock may be the furthest thing from their minds. Train all employees under the first-in, first-out rule, so the first products received are always the first to be placed on the sales floor.
Then, build a clear system in the stockroom so it’s easy for anyone to know they’re pulling stock from the right place. It could be as simple as having a manager conduct a daily spot check of the storeroom, removing shrink wrap from pallets as needed from the first-in products, or attaching color-coded labels.
Create a flagging system
As a supplier of all things related to pets, you’re storing and selling plenty of pet diets and treats with a sell-by date. That’s where your automated inventory system can be helpful. As a part of your receiving procedures, enter the optimal sell-by date, and create a system to notify you when that date arrives so you can pull unsold products from the shelf. This process can help you make smarter, more responsive decisions when it comes time to reorder.
Weigh the other factors
When it’s time to adjust your inventory levels, don’t make the decision in a vacuum, because many factors can influence sales. Think about market trends, whether the product is coming out with a new formula, prior year sales for the same period, seasonal changes and whether planned promotions are on the horizon. Factoring in this data can help you make the right forecast, so you don’t end up with an overstock or a shortage.
Keeping your inventory in balance can help your supply shop stay a step ahead of the competition. Making it part of your business practice will keep you in touch with the latest customer buying trends, and prevent waste from overstock or poorly merchandised products.
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