What are some of the best practices for managing inventory and reducing shrinkage?

From past situations, if you are doing manual counts, make sure to rotate the employees doing those counts. Its ok to have one employee count the majority of the time, but always do a random spot check to ensure accountability. Additionally, the person scanning items into inventory should be different then the person doing the manual counts. To many times, someone who is causing shrink will try to do BOTH jobs. Its an easy catch if you have the paper trail to show the discrepancy.

Consider inventory management like a game of chess. Each piece (or item) has its role, and each move (or decision) should strategically protect your assets and position you for success. Regularly analyze patterns and adjust tactics—anticipate where shrinkage might occur and implement proactive measures. Think of inventory tracking as your strategic overview; adjust and pivot as you spot trends and risks. By staying vigilant and adaptable, you'll keep your inventory secure and minimize loss.

In my experience check bills/invoices/charges/reports against what is physically coming through the back door. Make sure you are getting billed correctly.

Our POS system is a lifesaver in this instance. When we make a sale not only does it take the product out of inventory but we are able to accurately see pricing, store location, MAP pricing, wholesale pricing, and are able to track cash flow across multiple brands simultaneously. We also implement manual inventory checks that we sync with our POS system to make sure everything lines up. This helps with theft as well as allowing us to see if we need to change locations of products or promote other companies that might be struggling.

As an experienced store manager, the key to effective inventory management and shrinkage reduction involves a multi-pronged strategy. It starts with optimizing the store layout, using anti-theft technology like EAS systems, and ongoing employee training. Delivering excellent customer service indirectly deters theft, while clear return policies, POS monitoring, and FIFO inventory rotation maintain accuracy. Encourage feedback and collaboration with law enforcement for prompt action on theft incidents. This approach ensures inventory accuracy, minimizes shrinkage, and creates a secure shopping environment, safeguarding your business.

Imagine your inventory system as a live concert. Each product is a performer with a specific role in the show. To avoid chaos, keep the stage (your store) optimized by synchronizing setlists (stock levels) with audience demands (customer needs). Use data analytics like soundchecks to fine-tune your orders—know which acts (items) hit the high notes and which need a little more practice. By balancing the playlist (order quantities) with the audience's vibe (sales trends), you'll ensure a smooth performance with minimal disruptions and maximum applause.

And, over ordering on fresh goods with a Best Buy date will cause shrinkage if not sold. Under ordering is loss of sales & profits.

This is the KEY in today's rapidly changing environment. If you are working with old technology or no technology at all. You will find yourself behind the competition and eventually burned out and out of business. The information coming out in terms of ordering and supply chain is only as good as the information going into it. If your company is relying on an Intern for example to enter data and analyze the outcomes. You are in for a big surprise. It does not work. Managing inventory is a huge undertaking. EVERYONE on your team needs to understand the why's and the how's in order to be successful.

It is important that your firm understand the difference between operational loss and theft. For example, operational loss is often controllable and may not occur if certain procedures are completed correctly or if policies are followed. Your firm should have operational oversight of these procedures and an audit function to track quality performance. Often, when caught within a time period, these losses can be reversible. True theft losses should be investigated by someone who is trained in criminal detection of wrongdoing, including experience in interviewing those suspected of possible theft. These losses may be recouped through restitution or civil demand statutes in many cases.

According to many recent surveys out there: - 90% of all significant theft losses come from employees. - Cash theft is the top cause for over 20% of businesses. - 34% of millennials justify stealing from their job. - More than 30 percent of business bankruptcies are due to employee theft. Pay attention it could cost you your business.

Think of inventory management like hosting a secret party. You want to keep the guest list (inventory) under control to avoid unwanted disruptions. Start by securing your venue with invisible safeguards—consider digital tracking tools as your silent bouncers. Implement clear policies, like a secret handshake (protocols) for handling stock. Train your team to be vigilant and discrete, akin to having trusted friends who know how to keep the party flowing smoothly. By maintaining this high level of discretion and organization, you'll minimize the chances of any surprise guests (shrinkage) crashing the event.

And, in my experience, giving great customer service to all equally the same can be fair and a deterrent sometimes. Not all the time but sometimes which helps with a portion of theft. Asking each and everyone if they found everything they need.

I have found that monitoring actions is a daily activity for reduction with shrink. Customers, associates, inventory coming in, bills reviewed, best practices in ordering, and shrink in the areas of safety as well. So many things we do daily is a part of reducing shrink. The list is long but part of everything you do.

Think of managing inventory like nurturing a garden. Regularly check the health of your plants (stock levels) and soil (inventory systems). Use data as your sunlight—without it, you can't see where improvements are needed. Set performance indicators as growth markers, and adjust your care (strategies) based on how your garden (inventory) evolves. Regular check-ins help you spot issues early and adapt, ensuring your garden thrives without unwanted surprises. This ongoing care keeps your inventory in check and your operations flourishing.

Think of managing inventory like cooking a new recipe—you're not alone in the kitchen. Leverage others' expertise: consult industry leaders, join forums, and attend workshops. Gather diverse perspectives to fine-tune your approach. Adapt their proven strategies to fit your unique situation, just like tweaking a recipe to your taste. Regularly refresh your knowledge and stay open to feedback, ensuring your inventory management evolves with the best practices and keeps shrinkage in check.

Obtain and enlist advice from the local police authorities regarding shrinkage. Get advice on nearby based current trends, rings, deterrents, recourse, and prevention. These law enforcement agency staff will give you the facts along with valuable opinions on how to straddle ongoing theft.

Determine if the shrinkage is an inside job. This could well be from staff alerting outsiders with their help. Some goods are purposely, improperly price mark generated. Are only name brands or high markup items affected ? What patterns including whay days and times are involved ? Are there staff members 'discarding' brand new, unticketed items as if those items are mere refuse? Shift your focus to the thieves' approaches and methods. Yes, you may very well need to suspect your staff, too. Otherwise, once you determine the source of the bulk of the shrinkage, utilize rf tags, sensomatics, lock away goods for those affected items.

Back room organization is key. This in conjunction with excellent visual merchandising decreases the time items are in store, and instead in a customer’s purchase. Random audit counts throughout the year of product being received from a delivery also helps to catch discrepancies before any sort of inventory. I find that eliminating internal theft always decreased my shrink numbers to lows no other Store Manager could accomplish at certain locations that were considered “high shrink”.

- First step of managing an inventory is (pre inventory preparations) in order to minimize the working hours down time of your store it’s better if you do the following: 1. Reduce stocks (receiving from suppliers, warehouse, transfers between stores m, etc) 2. Segregate your range to count them easily once you start your inventory. 3. Collect full sets in order to minimize the inventory time. - Shrinkage reduction is a challenge, to excel it you need to be on top of your inventory: 1. Transfers between stores, analyze turn over of each product in per stores to have a better view. 2. Apply product discounts. 3. Control stocks by analyzing your turn over for each SKU. 4. Compare your prices in order to reach same price point of each SKU.

In a world that changes everyday, be ready to change with it, be safe, and enjoy the ride. But don’t get complacent. Someone is always thinking up something new that you will have to put a new process in to stop.(external theft) And people that get complacent are going to incur more shrink & less profits. (Associates.) And, higher pricing for customers at the checkout to off set that shrink.

In addition to the great information already shared, having the right people in the right roles and trained certainly will provide an ROI in shrinkage control.