[vc_row][vc_column 0=””][vc_column_text]Training for a marathon or any kind of race takes preparation. You need to know the date of the race and work backward to develop your training schedule. You will determine running milestones before the race to prepare your body, schedule conditioning and rest days to improve endurance and speed and develop a nutrition plan to properly fuel your body. The more you prepare in advance, the more successful you will be at completing the marathon and setting a new personal record.
The same is true when onboarding to a new Inventory Management and POS system. It is not an overnight decision or switch; it should be a thought out and planned process to give you the tools you need to successfully use the new system. The transition plan should include milestones, schedules, and training along the way.
Once in the onboarding process at RICS, Vicki, Casey, and our Onboarding team will help:
After you are ringing sales on RICS, there is a dedicated Support Team to answer questions, educate you on various aspects of the system and continue to guide you on the system. They are available 12 hours a day, every day.
Using an Inventory Management system is not a sprint – it is a marathon. It takes preparation, thought and dedication in order to use the system most effectively and be able to increase profits while reducing inventory. If you would like to learn more about the RICS team contact us at firstname.lastname@example.org or click here to schedule a meeting.[/vc_column_text][/vc_column][/vc_row] Join RICS and RMSA as they talk open to buy planning for retail. Watch this free webinar to learn how to create a better buying plan for your business.
You can find our additional webinars by clicking here or check out our Youtube playlist. Before beginning the creation process of open-to-buy, it is important to review your Key Performance Indicators and decide on which KPIs are most important to your business. Many retailers measure their product using Turns, ROI, Gross Profit %, Profit, Net Sales, and others. Once decided, RICS offers many different reports which can be used to review those KPIS and begin measuring the success of your business.
To start, we need to set our frame of mind and understand that the overall reason to create an open-to-buy process is to help bring the right product, in the store, at the right time. That’s the overall all goal of having a business, right? If you have the right product, in the store, at the right time, you’ll have a product to sell for every customer that walks in your door.
To get the right product, you’ll want to review your data you already have in RICS. It is important to understand how your product has performed historically (Sales Comparison Report), how it trends season to season (Sales By Month Report), understand what product you have at on-hand (Grid Analysis Report), as well as making sure you are selling at the right price point (Sales Analysis Price Point Summary). When running these reports, you’ll want to take a high-level approach and review which top performing classes and suppliers exists inside of your business. Once you’ve identified the top performing classes and suppliers, you’ll want to continue to drill down further into your hierarchy to understand at a SKU level and ultimately a size level which products are your best sellers. Drilling down into the product will help identify your core products in your organization which are the most important products to manage efficiently and effectively.
Finally, once you’ve determined what are the core products that exist in your organization, RICS has the ability to help you automate the way you fill in orders by using product models and our Generate Automated Purchase Order Report. By filling in the product model information into RICS’ Generate Automatic Purchase Orders report, it will provide you a suggestion on which products to order based on on-hands and on order quantities. These efficiencies can help you drastically cut down on your ordering time by simply using RICS suggestions as a starting point and then managing the ordering process there after. When you’re managing more than one store, it can be difficult to stay on top of how your inventory is doing across locations. Optimizing your inventory for each store and for your business as a whole is an important part of creating a business model that makes you money. So when it comes to optimizing your inventory to get the most bang for your buck, where do you start?
Check out these three tips for how you can better manage and optimize your inventory in your multi-store business.
Analyze inventory performance monthly (at minimum)
Ideally, you want to be analyzing your inventory as often as possible. If you can’t get around to viewing performance daily (or even weekly), make sure you are at least setting some time every month to review your inventory performance. This will help you identify you best and worst sellers, along with which stores are selling what products.
Map inventory sales
Sometimes you might find that one piece isn’t selling well at one location but is flying off the shelves at another. That’s why it’s so important to map your sales to each of your locations. When you know inventory is performing better in one location, you can move some of your stock to that location rather than allow it to collect dust on your shelves. On top of that, you’ll avoid being overstocked due to ordering new products by borrowing inventory from other locations.
Take advantage of transfers
As mentioned above, optimizing your inventory can also mean borrowing inventory from other stores. The idea that you should ‘buy from yourself’ before placing a new order can be instrumental in avoiding excess inventory at the end of the year. Use store transfers to move inventory around to the location that you know will be able to sell it.
For more tips on managing your multi-store business, download our free guide, Guide to Multi-Store Management.
Increased profitability in retail can come from many different places. Better inventory management, smarter buying and markdowns decisions, and keeping down expenses are all places from which retailers can pull bigger profits.
So, what’s the one common theme in improving performance in each of these business areas? The key piece to the puzzle? Efficiency.
It sounds simple enough. We all know we want to be more efficient. We all want to maximize our work hours and be more effective at running our business. The question is how do we improve that efficiency? And the answer has never really changed. We get better tools.
- Establish a plan with milestones from saying yes to going live
- Migrate and organizing your data
- Advise you on managing your data going forward
- Prepare you to use RICS through hands-on training sessions
- Help you train your employees to be confident users
- Be available during go live to ensure everything is running smoothly
Running a retail business without the right technology for automating buying and markdown decisions, or getting access to key performance indicators on merchandise and employees, is tantamount to waiving the white flag in this increasingly competitive environment. We must stay dynamic and always be looking for ways to improve our processes.
The importation of data into our POS and inventory management system is another one of these key efficiencies that will add more time back to your day, which equals making more money in your business. It will add to the efficiency of entering purchase orders, processing special orders, and insuring data consistency across all your stores.
If your POS system doesn’t allow for the importation of things like products Customers, (SKUs), prices, Vendors, and UPCs, then my guess is that you are spending a lot of time entering them manually. Think about being able to request a product file from your vendor, copy and paste it into a template, and drop that file into your POS system!
Import those UPCs for all the products in your system off an Excel sheet instead of scanning each item individually. Use the tools available to make running your business easier and more profitable.
If you don’t have the ability to do this with your current POS and inventory management system, then maybe it’s time to look for a new one.
Reasons You Should Mark Down Products
If you’ve got too many items from the holiday season, you’ve overbooked on a new supplier that isn’t panning out, or you simply want to bring new product and spice the store up a bit, it may be time to markdown product.
- Poor Sales
Head on over to RICS reporting and run the worst sellers report. This report will show you some of your top worst sellers in your store. It may be time to mark some of those down.
- Core Product Changes
Do you have a new core product leader in your store? Is there a supplier that you’re ready to phase out? These could be good reasons to put a few items over to the markdown rack.
Ways to Mark Down Products in RICS
For additional markdown best practices, check out this guide! It’s getting close to the most wonderful time of the year! With Thanksgiving, Black Friday, Small Business Saturday, Cyber Monday, etc. there will be tons of deals going on! However, as you finish up the end of the year, don’t let your end of the year physical inventory slip your mind.
Starting the new year out on the right foot with clean, on-hand inventory numbers can be almost as important as getting those final holiday sales off of the shelf. Having accurate on-hand inventory numbers will help with accurate ordering and precise accounting. Your financial advisor, accountant, and wallet will thank you! If you consider your inventory as piles of money sitting on your shelves, you’d want to make sure you can account for every dime!
In order to perform a physical inventory, you’ll need to determine your method of counting. Options include, by hand on pen and paper, scanning items with a laptop and the scanner from your register, or using a portable data reader (you can find that here: shop-rics.com).
Once you’ve determined your method of counting, you can begin entering that information into RICS under the Physical Inventory section. The physical inventory process in RICS helps you account for potential missed items. RICS has a View Physical Counts report, Items Not Counted report, Enter Zero Counts section, and a Variance report. These reports will help ensure you’ve captured and counted all of the products in your organization.
For more details on the entire process, you can visit our RICS Knowledge Base.
If you need assistance during this process, RICS support is available 9 am – 9 pm EST, 7 days a week. View the message center on your RICS back office for the Holiday schedule. Drew and Jim are two retailers who are running their retail stores very differently. Read on to see the differences to see between managing your inventory manually and having a POS and inventory management system in place.
Drew is a shoe store owner who doesn’t use a point of sale or inventory management system. He manually keeps track of his inventory. This has cost him many headaches and a lot of time calculating KPIs to know how his business is performing. While he has only ever tracked his inventory by hand and has a system down for entering new shipments and purchases, he doesn’t realize how much more efficient he could be if he had retail technology in place.
He has owned his business for over 20 years and has never questioned his manual system. While sometimes he wonders if using a POS and inventory management system could make his life easier, he thinks he already has a good enough way to calculate what he needs to know when making buying decisions. He can’t really get over the obstacle of having to change how he runs his business and rely on technology to do it. Drew also wonders why he should spend money on technology when it seems he is clearly capable of doing it himself. Little does he know, taking the time to switch to retail technology will end up saving him plenty of time and start earning him more money through business-changing insights a POS and inventory management system offers.
Jim is a shoe store owner who uses RICS Software to manage his store. He has been working in retail for 15 years and has experienced the hardships of not having a system in place. Since switching to RICS, he has become a more profitable retailer with more time on his hands. Before having a system, he always worried about what might happen if he lost the paper he used to track his inventory or his computer crashed and all of his data disappeared. Having the peace of mind knowing his data isn’t going anywhere has been greatly beneficial. Not only can he rely on RICS to store the data, but he can also access it anytime he wants, from anywhere he wants. Being able to make business decisions in real time has led to greater profits and many hours back in his day.
Utilizing RICS’ robust reporting capabilities has allowed Jim to make smarter buying decisions and he also has a constant pulse on how his business is doing, without having to spend much time at all manually calculating. His business is now run much more efficiently having retail technology in place that ensures accurate and up-to-date data for insightful reporting and analytics.
Convinced why you need an inventory management solution like RICS? Check out our Checklist for a New Inventory Management System. As a retailer, you are always wanting to stay profitable and keep a consistent cash flow. If the inventory on your shelves isn’t moving, you need to find ways to turn it over in order to free up cash flow to pay for the next order. One of the best ways to turn inventory over is by knowing and practicing the following tips:
Know the Industry – You need to know the latest trends and styles for the type of inventory you are selling. You want to make sure you are supplying what is in current demand. That means you need to give up selling last season’s shoes and stay up-to-date on the latest fashions. You also need to make sure you are selling for the right season at the right time. If you are a specialty running retailer, make sure you have the newest gear ready to sell around Marathon season! Also be prepared with cold weather accessories when winter hits.
Know Your Customer – Buy what your customers are buying. By using your data in your POS and inventory management system, you can pull reports to see what customers are buying the most or least of. Knowing what they want will help you forecast demand and allow you to continue buying the products that your shoppers seek out. You can also see which brands and styles have been your best sellers. It never hurts to have conversations with your customers and ask them about their favorite products. Just be sure to add this information to their customer profile so that you don’t forget!
Buy and Price for Profitability – Buy items that can make you money and can turn over quickly. Figure out how to price your items at a point that will sell, while also earning profit. Knowing that sweet spot where items aren’t overpriced, but will still be profitable is the key to keeping your cash flow in the positive.
Manage Discount Cycles – When new inventory comes in, set up a markdown calendar. For example, if the items haven’t turned over in 30 days, give a 10% discount, 40 days, 25%, 60 days, 35%, and so on. While no retailer likes having to sell inventory at a discounted rate, it is essential for moving old inventory out and continuing to make money. For more suggestions and tips on marking down your inventory, check out these best practices.
To learn more about how you can quickly put your business back in the green when it comes to cash flow, download our free guide! [vc_row][vc_column][vc_column_text]One of the biggest concerns when it comes to managing inventory is shrinkage. There are several reasons inventory loss can occur. Preventing inventory loss and reducing costs can be manageable with the right POS and inventory management system.
- Group or Supplier Discounts (Inventory:: Stock Maintenance:: Enter Price Discounts )
This method is the best way to markdown products across the entire store, an entire class, or supplier. RICS allows you to mark down theses products based on a group or category that they fall under. It could be a certain supplier, class, custom entry, etc.
- Large, Unassociated Groups of SKUs (System:: Import:: Universal Imports)
Using the Universal Imports page, you can import products that you’d like to update the markdown price. Using the Price template, RICS allows for you to enter the markdown price for SKUs through the universal imports functionality. This method is the most efficient way for “excel wizards” or if you’ve got a large list of random SKUs.
- Single, Manual Discounts (Setup:: Manage SKUs)
If you’ve only got a handful of SKUs (less than 20) that you want to markdown, the fast way to mark these items down will probably be the old fashion way. Navigate to the Manage SKU page and enter in the markdown price for the SKUs. You’ll still have the ability to set the markdown date range (if its only for a limited time), but it will be the most efficient way if you’re working with 20 or fewer SKUS.
Before deciding on a strategy for preventing inventory loss, it is important to identify who is causing the loss. There are four main areas of inventory loss. According to the National Retail Federation, customer shoplifting is the most common, followed by internal theft from employees. Internal error, such as administrative and paperwork errors, and mistakes by the vendor are also common causes of shrinkage. Recognize where your inventory goes missing to choose an appropriate prevention strategy.
Now that you know who is causing inventory loss, you should look at why these mistakes are happening. One of the main causes of human error is having the wrong POS and inventory management system for your business. Technology has become increasingly important in managing your business, so the wrong system could make you more open to theft and error. Internal theft and error can also occur when you choose the wrong employees or don’t train them well enough. Overstocked inventory and wrong layout can cause you to lose track of inventory. Lastly, if you don’t audit your orders from vendors, you could fail to notice incorrect or missing items.
Tips for prevention
Knowing where your inventory loss is coming from makes it easier to combat. Here are some tips to prevent inventory loss in your store:
To see the full guide on preventing shrinkage in your store, click here.[/vc_column_text][vc_column_text]
- Invest in a POS and inventory management system that helps you visibly track your inventory to prevent theft and error.
- Conduct physical inventories once a month to catch any errors.
- Install sufficient security to prevent and identify theft.
- Keep your store clean and organized to keep track of inventory in the front of the store.
- Place all high-target items in plain sight.
Read the full guide below:
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/1″][minti_divider style=”4″][/vc_column][/vc_row][vc_row][vc_column width=”1/4″][/vc_column][vc_column text_align=”center” width=”1/2″][minti_headline type=”h2″ font=”font-special” size=”fontsize-xxxl” weight=”fontweight-800″ lineheight=”lh-12″ transform=”transform-uppercase”]Get the guide[/minti_headline][minti_button link=”/wp-content/uploads/2016/06/eBook-Inventory-Loss.pdf” target=”_blank” icon=”fa-chevron-right” appear=”true”]Download Now[/minti_button][minti_image img=”3712″ lightbox=”2″ url=”/wp-content/uploads/2016/06/eBook-Inventory-Loss.pdf” target=”_blank” align=”center” hover=”image_tilt”][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row][vc_row][vc_column width=”1/1″][minti_divider style=”4″][/vc_column][/vc_row] We have all been there. You sit down to accomplish a task and just as you get into it, you discover you don’t have the information you need to effectively complete it. Often times in retail not having the whole picture can be frustrating and costly, especially as it relates to buying. This area of your business can make or break you. Trying to place buys on the fly can tie up one to buy dollars and result in less profits.
Having a robust inventory management system for your retail business is key to effective buying. The right inventory management system can lower inventory costs and increase revenue. Inventory management is more than on-hands and sales. Every system collects data, but not every system can crystalize the data in a meaningful way that allows you to easily and quickly make important business decisions.
The buying process is a key beneficiary of having great data. Running reports with your data offers a full picture of where your dollars are allocated. Seeing sales, on-hands, on-order, and futures all in one view is powerful. When you sit down to put together your next buy ask yourself, am I really using my open to buy dollars wisely? If the answer is no, then consider investing in a inventory management system and stop making buys on a hunch. With the warm weather seeming as though it is finally here to stay, more and more people are wanting to spend time outside. As a retailer, how will you compete against the beautiful weather and get shoppers to step inside your store? You should consider having a sidewalk sale!
Here are some quick and easy tips to make your sidewalk sale a smashing success:
Happy planning and good luck. Now go enjoy the nice weather! Getting customers into your store is just the first step in (hopefully) making a sale. Once they are in your store, you want to do everything you can to give them a positive experience. This will make shoppers more likely to stay, look around, and make a purchase. We have several suggestions for creating a store layout that attracts your customers and is also conducive to selling your products.
- Pick a traditionally warm-weathered weekend. Although you can never perfectly predict the weather, it would be ideal to have your sidewalk sale on a day that is historically warm and ideally rain-free.
- Spread the word. Make sure you market your event and let your customers and non-customers alike know about your big day. Check out this free guide to learn how.
- Pump up the volume. On the day of your sale, you’ll want to make sure people notice you. Play some summertime music or even have live band!
- Have an “attractor factor.” You’ll definitely attract a crowd if you have something like a cotton candy machine, popcorn machine, or even a bounce house. You can even be a little more low key by having bubbles, sprinklers, or balloons. Invite people to bring their dogs by!
- Offer drinks and snacks. A little food can go a long way to make for a happy shopper!
- Offer great merchandise at low prices. The most important part of your sidewalk sale is having great deals that will make people want to purchase. Half the battle is getting people to your sale, but equally important is having people buy. Make sure you’re offering irresistible deals!
Check out the infographic to see some of the best ways to make your store (and inventory) stand out to your in-store customers. It’s that time of year again….it’s time to think about spring cleaning! Spring is a time of change and new beginnings, so why not take the time to think about how you can refresh your store? Here is a list of spring cleaning tips for you to consider this season:
- Clear Signage: Be sure your store clearly indicates what you sell, so your customers know what to expect immediately.
- Entice Window Shoppers: Having intriguing window displays in place will help convert window shoppers into real shoppers!
- Give a Lasting Impression: As soon as your shoppers walk in, draw them in with a relevant and meaningful display that makes them want to explore the rest of your store.
- Create a Purposeful Path: Create a path with tables and rack to steer shoppers in a counter clockwise fashion that prevents them from missing the inventory you want to showcase.
- Good Mirrors: Having good, full length mirrors is essential for helping shoppers decide on a purchase and see the complete look.
- Offer Breaks in Inventory: Don’t overwhelm your customers and use aisles, seating, and additions like art to break up your inventory.
- Stay Organized: Make sure your inventory is organized in a sensible and appealing way that won’t frustrate or overwhelm your shoppers.
- Display Inventory in Checkout Line: Having inventory like add-ons or accessories with a low price point at the checkout line gives customers something to consider while waiting.
- Don’t Overdo Counter Space: Reserve counter space simply for checking out purposes so you have more room to interact with the customers.
- Good Lighting: A well-lit store is not only more inviting, but also helps your inventory look more appealing.
If you’re looking for other tips for your business, check out our other resources! [vc_row bottom_padding=”40″][vc_column width=”1/1″][vc_column_text]As a retailer, getting customers into your store is incredibly important for moving inventory. But getting them there is only half the battle. Once shoppers enter your store there are several factors that could keep them from making a purchase, including your store layout. Follow along with our infographic to create the perfect store layout for your in-store customers.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/1″][minti_headline type=”h2″]The store layout of your dreams 🤩👇[/minti_headline][minti_image img=”15771″ lightbox=”2″ url=”/wp-content/uploads/2016/03/Infographic-Perfecting-Your-Store-Layout.pdf”][/vc_column][/vc_row] Your inventory is the reason your retail store is in business. Without it, you wouldn’t have anything to offer your customers in exchange for profit. Because it is so essential to your success, you need to make sure you understand every aspect of your inventory. The better you understand which inventory is making you money, the process that works best for receiving your inventory, and what inventory you should be buying each season will all ensure that you being a smart and therefore profitable retailer.
We have compiled a list from A to Z that will take you through all of the benefits and aspects of inventory management you should make sure you are familiar with. We have included suggestions for what to do with old inventory, how you should be tracking and using your inventory data, how you should be using your inventory management system to get the most out of your inventory and business, and how you should implement a standardized inventory process.
Be sure to check out the complete list here that includes everything you need to know about your inventory. If you want to learn how to manage your inventory in more depth, see the Inventory Management Best Practices guide that takes you through the best ways to use your data, run your store, and monitor metrics so that you can get the most out of your business. As a business owner, you may have your sight set on opening additional locations in your future plans. But how do you make sure you’re really ready to make the leap and start the process for opening your next location? Ask yourself the following questions and get a plan in place before you make the decision to pull the trigger.
- Go through all of your old inventory and decide what is worth keeping. Try to sell at a marked-down price, or perhaps you don’t want to keep it and are willing to donate it instead. If you haven’t sold it for the last 2 seasons, maybe it is time to say good bye.
- Go through all of your employee files and make sure all of the information is accurate and up-to-date.
- Do you have any outstanding purchase orders? If so, you might want to cancel them if they are still on backorder.
- Go through your records and make sure no one owes you money. If they do, it is time to pick up the phone or send an email to let them know.
- Spring clean your store! Invite your staff to come in and help clean, but make it fun! Play music, order food, and take photos! Pull out that dusty vacuum, use a mop and broom, and scrub all of the nooks and crannies throughout the store.
- Do your air vents need to be cleaned out? Now is the time to find out!
- Be sure to clean your window displays and wipe away all of those fingerprints and get rid of those dead flies!
- If you have a bathroom or an employee break room, you should definitely deep-clean them.
- Go through all of your emails and delete those that you don’t need anymore. If you don’t like to delete anything, create separate folders and move items from your inbox to your folders.
- Do your employees need a training refresher? Could your employees benefit from evaluations? Spring is a great excuse to do those!
Are your current locations stable?
Before you venture out and open another location, you need to make sure your current stores are pulling their weight. Opening additional locations will take a lot of your attention, so you need to make sure they are functioning in a profitable manner. If you find you have a store that’s struggling to stay above water, you might want to put your efforts into revamping that store rather than opening a new one.
Do you have funds available for this venture?
It’s a mistake to think the cash flow from your current location can fund your second location. You want to make sure you keep the plans for financing a new venture separate from your current store. You don’t want your new location to be sucking in all of the profits from your older, successful stores.
Are you running out of room?
If you find yourself bursting at the seams and failing to keep up with demand, you may want to consider looking into a second location. But if you find that demand in new locations aren’t as high as they are in your current location, you may want to consider moving your inventory to a new space, or looking for a larger unit for your store.
Do you have the right people to take on more responsibility?
If you’re venturing out to open a new location, you need to make sure you have staff at your current stores that you trust to continue running them the way you want. If your staff lacks the ability to take on the additional responsibilities, you may want to consider building a staff that can better assist you in your venture. Adding the right people to the payroll can even improve the overall performance of your stores, giving you more incentive to open a new location!
How will you bring your current culture to your new store?
Retailing today requires more than just inventory, it needs a great experience for shoppers. If you have a successful business, chances are you’ve provided a great experience for your customers. How will you make sure your next venture offers the same culture? Making sure you can bring an equally successful culture to your new store will be an important part of planning a new store.
While answering these questions will help you evaluate if you’re ready to become a multi-store business, you need to put the effort in to make a business plan. Opening a successful new location will require a detailed plan for how you’ll fund, run, and market your new store. Interested in moving forward? Download our Guide to Multi-Store Management for more information on how to effectively run multiple stores. When searching for a new inventory management system, there are several things you will want to consider. We have created a checklist that covers the essentials your system should have to help you run an efficient retail business. A point of sale system is no longer just used to ring sales, it has much greater capabilities that you should be taking advantage of. In addition to scanning items at checkout, your system should track your inventory, generate reports, and integrate with other retail solutions.
Having a retail software system that is easy to learn and operate will ease the transition of switching and make it easy to train and onboard new employees. A key feature your system should be capable of is collecting data and customer information at the point of sale. This will help you capture your client base, which will help with marketing efforts and creating targeted campaigns to get customers to come back to your store.
In this day and age, having a cloud-hosted solution is also very important. You don’t have to worry about the risk of losing all of your data when you can store it in the cloud and access it from anywhere, anytime. Being able to then use that data to generate reports on sales, employees, customers, ecommerce, marketing, etc. will help you really understand you business in terms of what’s working and what’s not.
See the full checklist of features you should ensure you inventory management system has. If it lacks any of the following, you may want to consider switching your system, so you can get the most out of your business. [vc_row bottom_padding=”40″][vc_column width=”1/1″][vc_column_text]Understanding all aspects of your inventory is essential to run a successful retail business. We have compiled a list, from A to Z, of everything you need to know about your inventory![/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/1″][minti_image img=”3230″ lightbox=”2″ url=”/wp-content/uploads/2016/07/Infographic-Tax-Free-Weekend-2017.pdf”][/vc_column][/vc_row] Your inventory is your store’s largest asset so knowing when it’s time to move out old merchandise and make room for the new is very important. No seller likes to markdown full-price products. But the reality is, your inventory only has a 60-90 day shelf-life, meaning if you don’t turn your inventory in that 3 month period, it’s probably costing you money. We have created a timeline that you should consider following for turning inventory.
Week 1: Intake inventory to stock, pricing, put out new inventory
Week 2 – Week 8: Full-price sales and promotions
Week 9 – Week 12: Start markdowns and clear room for new inventory
To make the most of your markdowns, you should be aware of some of the best practices for discounting your inventory:
Markdown in season: If products aren’t selling at full-price and the season is dwindling down, it’s time to start marking down products. Customers will feel like they are really getting a deal on something they can use right away, rather than something they won’t be able to use until next year. And when customers buy products, even marked down products, they put more cash back in your pocket!
Markdown at least 20%: Don’t waste time gradually increasing the markdown percentage. If you do that, you may end up hanging on to the item too long and miss out on a chance for a sale. Instead, start at 20% and move items out more quickly. Customers will be more likely to jump on items that are marked down at a higher rate.
Have a clearance section: Having a section in the back of your store dedicated to clearance items will help your customers. If they are looking for a good deal, they will know exactly where to go. By locating the clearance section in the back of the store, customers will have to walk by all of your new merchandise. You could also consider having price point tables for the inventory that still isn’t selling in the clearance section. Mark everything as “x” dollars to make the purchasing decision easier for your customers, and they’ll feel like they’re getting a good deal!
Markdowns are an essential part of maintaining healthy cash flow. Smart retailers understand this and make the most of their marked down inventory. To learn about the other best practices for markdowns, check out this guide!