RICS recommends doing a couple things to ensure your inventory is controlled and rotating regularly through your store. Here’s a tip: be ruthless.
Liquidate non-moving items to make space for profitable products
Sometimes it’s better to just cut your losses and move on. At the end of the day, turning a smaller profit on slow-moving inventory is better than losing money while it takes up space and bottom line. Running promotions and offering discounts are good tactics for moving stagnant inventory through the purchasing cycle. Once the last of these items have been cleared out of the storeroom, you can utilize the data and reports at your disposal to accurately gauge demand and make way for profitable merchandise.
Check data and reports frequently
Monthly status updates are not frequent enough to provide a relevant snapshot of how your store is performing. The more often you access these numbers, the more quickly you will be made aware of red flags, allowing you to perceive and solve problems before they grow and threaten the success of your business.
Pay attention to availability dates & pricing changes
As long as we’re talking about diligence and staying up-to-date with pertinent business information, it’s worth noting the importance of staying aware of vendor changes as well. Your business doesn’t operate in a vacuum; not only do you need to consider the inner workings of your own business, but you must be conscious of shifts and alterations with your suppliers.
Create compliance policies to standardize your inventory process
In order to make sure things are done the right way the first time, it is necessary to establish checkpoints and tasks that must be completed before a product can go on the sales floor. These procedures cover the way products are counted, labeled, selected, and stocked before they can be sold.
Utilize supplier's inventory to avoid too much inventory on-hand
Many retailers utilize their supplier's inventory to save a sale when they do not have what the customer is asking for. Some retailers choose to offer shipping directly to the customer; while others choose to use this as an opportunity to get the customer back into the store when the item is ready for pick up. Either way, you are keeping floor space open for your own inventory, while still making the sale.