Covid-19 and its forced retail shutdowns are a memory of the past. However, the lingering effects on our supply chain, consumer behaviors and retail inventories remain front and present as we look at managing business going forward.
Recent retail news has been focused on both large and small retailers finding themselves in a position where inventories are too heavy. While that may or may not be the specific case for your store, it’s clear that a focus on managing inventory, margins and turn has more importance now than ever before.
What are the keys to making smart, data-driven decisions that can help you be well positioned for Holiday and the first half of 2023? Here are 5 steps to put you in charge of your store’s success:
- Step 1: Don’t put off getting the right tools – Access to real inventory data allows you to make decisions based on numbers and not just intuition. Using key metrics such as Margin, Turn, and ROI by SKU, Vendor, Class/Department and Sub-Classes, will result in a focused assortment, setting you up for a successful season.
- Step 2: Begin your analysis at the top and work your way down – Understanding the performance of inventory in your store by category provides the high-level view. But drilling down into vendors, styles, sizes or colors will identify where to trim back or where to buy more as you manage future orders.
- Step 3: Don’t be afraid to take markdowns – Keeping inventory that will slowly sell over multiple seasons with the hopes of maintaining a high margin is not a recipe for success. Use your best sellers report to quickly identify what is working and what is not. Focus on high margin, high turn inventory items that will improve your business’ financial health, and mark down the slow turning items, now.
- Step 4: Be aware of evolving consumer behavior – Keep analyzing your sales channels and look for the trends of your shoppers over the last few months. What are they buying, where are they buying it and how is markdown merchandise performing compared to regular price? Keep vigilant and look for your customer’s patterns.
- Step 5: Stay connected with your suppliers. Understand their inventory positions for Q4 2022 and Q1 of 2023. Don’t just ask once, ask often. Check their B2B sites regularly. Call your reps or the corporate office. Set a calendar and cadence for staying on top of key vendors and their ability to fulfill orders.
In conclusion, following these 5 easy steps will help you make data driven decisions to ensure a successful Holiday. Can’t access your data easily? There’s no time like the present to make technology change!
Contact the Author Aaron Randall at 317-275-5927 or via arandall@ricssoftware.com any time to learn more about RICS and how the features of their remarkable POS and Inventory Management Systems will work for you.
BRA note: We are very pleased to mention that RICS Software is a BRA Supporting Vendor Partner who is offering fifty percent (50%) off all year one costs for all BRA Distinguished Retail Members that begin onboarding before the end of the year. Be sure to mention BRA when connecting with Aaron and the solid people behind this outstanding resource.
– Doug Works, Executive Director BRA
If you are not yet a BRA Retail Member, you can easily opt in to either Regular (no cost) or Distinguished ($100/yr.) Membership via this super simple join form