In order to survive the changes in today’s retail landscape, you’ll need to fight the retail demogorgon: unsold inventory.
I’m sure you’ve heard – the Netflix series Stranger Things released their second season. And as a result, I’ve spent hours binge-watching the series.
Just like the kids in Stranger Things, retailers are also facing a terrifying monster.
Inventory is your store’s largest asset, but can also be your worst expense. Like Steve Harrington and his bat of nails, these tips will help you change the way you look at buying, fight unsold inventory, and improve cash flow.
Image credit: Netflix
Here are 3 ways you can fight the retail Demogorgon:
#1 Identify slow moving inventory
Use your inventory management system to find your worst performers. After you identify what products might be taking up room on your shelves, stop yourself from ordering more of the poor performers and start setting up a markdown calendar for those items.
#2 Create a markdown strategy
Markdowns. No store wants them, but every store has them. In reality, markdowns are a HEALTHY part of doing business. By marking down products, you increase the speed in which you sell the poor performing inventory. This gives you more cash to purchase inventory with a high turn rate that is performing well.
#3 Make better buying decisions
When you understand how your inventory is performing, you can use that info to make better buying decisions. Once you know what items are poor performers, sell them quickly and use your cash to invest in high productivity classes, brands, and products.
Making these decisions will improve your inventory productivity to increase cash flow. Unsold inventory = defeated.