How can you minimize shrinkage and maximize sales with balanced inventory levels?

由人工智能和领英社区提供技术支持

Inventory management is a crucial skill for any retail operation, as it affects both your sales and your costs. Having too much or too little inventory can lead to shrinkage, which is the loss of inventory due to theft, damage, or error. Shrinkage can reduce your profitability and customer satisfaction, so you need to find the right balance between stocking enough inventory to meet demand and avoiding excess or obsolete inventory that takes up space and money. In this article, we will share some tips on how to minimize shrinkage and maximize sales with balanced inventory levels.

在这篇协作文章中查找专家回答

由社区从 3 条内容中精选。了解更多

1 Know your inventory turnover ratio

One of the key metrics to measure your inventory performance is the inventory turnover ratio, which is the number of times you sell and replace your inventory in a given period. A high inventory turnover ratio indicates that you are selling your inventory quickly and efficiently, while a low inventory turnover ratio suggests that you have too much inventory that is not moving or selling. To calculate your inventory turnover ratio, divide your cost of goods sold by your average inventory value. You can compare your inventory turnover ratio with industry benchmarks or your own historical data to see how well you are managing your inventory.

添加您的观点

Muhammad Ali Saeed

| FMCG | Food & Beverage | Textiles | Building Material | Global Operations Mgmt | Project Mgmt | Greenfield Proj. | Sys Dev & Implmnt.| Sourcing & Proc. | Strategic Supply Chain | Consultancy | Coaching & Teaching |
举报内容
To minimize shrinkage and maximize sales with balanced Inv levels, businesses should employ data-driven forecasting models, implement efficient Inv mangmt systems, and establish regular monitoring mechanisms. Accurate demand forecasting helps maintain optimal stock levels, reducing excess Inv prone to obsolescence or theft. Implementing RFID technology, security measures, and employee training can mitigate shrinkage. Additionally, adopting JIT Inv practices ensures products are restocked in line with actual demand, preventing overstock situations. Striking a balance between supply and demand not only minimizes shrinkage but also enhances customer satisfaction by ensuring products are consistently available.

已翻译

赞

2 Conduct regular inventory audits

Another way to minimize shrinkage and maximize sales is to conduct regular inventory audits, which are checks of your physical inventory against your records. Inventory audits can help you identify any discrepancies, errors, or losses in your inventory, and take corrective actions to prevent them from happening again. You can use different methods of inventory audits, such as cycle counting, which is counting a small portion of your inventory every day or week, or full physical counts, which is counting your entire inventory at once. You should also use a reliable inventory management system or software to track your inventory levels, movements, and transactions.

添加您的观点

Hira Mahmood

Category Manager||xAirlift||e-commerce||Supply Chain & Logistics Management||Operations||Planning||xAuchan
举报内容
Inventory audits should be scheduled at regular intervals especially for FMCG category to account for any damaged, expired or near to expiry stock, and discrepancies in physical vs system inventory count. Inventory audits will help identify damaged and expired stock as a proactive approach to ensure customer satisfaction. And will lead to accurate inventory levels helping in accurate demand forecasting as the discrepancy in physical vs system inventory levels will potentially lead to overstock or out of stock situations creating shrinkage in terms of cash flow, optimal inventory levels, sales and customer satisfaction.

已翻译

赞

3 Optimize your inventory layout and security

Your inventory layout and security can also affect your shrinkage and sales. You should optimize your inventory layout to make it easy for your staff and customers to find and access the products they need, and to reduce the risk of damage or spoilage. You should also implement security measures to prevent theft or fraud, such as using locks, cameras, alarms, tags, or sensors. You should also train your staff on how to handle and protect your inventory, and how to spot and report any suspicious activities or behaviors.

添加您的观点

4 Forecast your demand and plan your purchases

To balance your inventory levels, you need to forecast your demand and plan your purchases accordingly. Demand forecasting is the process of estimating how much inventory you will need to meet your customer demand in the future, based on factors such as historical sales, seasonal trends, market conditions, and promotions. Demand forecasting can help you avoid overstocking or understocking your inventory, and optimize your cash flow and storage space. You can use various methods of demand forecasting, such as qualitative methods, which rely on expert opinions or surveys, or quantitative methods, which use mathematical models or formulas.

添加您的观点

5 Implement inventory reduction strategies

Finally, if you have excess or obsolete inventory that is taking up space and money, you should implement inventory reduction strategies to clear them out and free up your resources. Inventory reduction strategies are ways to sell or dispose of your unwanted inventory, such as offering discounts, bundling, donating, recycling, or liquidating. Inventory reduction strategies can help you recover some of your costs, improve your inventory turnover ratio, and create more room for your fast-selling or new inventory. However, you should use inventory reduction strategies sparingly and strategically, as they can also affect your profit margin and brand image.

添加您的观点

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

添加您的观点

Joseph Nwabuebo

Head, Supply Chain
举报内容
Ensure you do not keep excess inventory which is a function of sales vs production. If only you could match your sales with your output/production, shrinkage will be greatly reduced.

已翻译

赞

Retail Operations

+ 关注

给文章评分

我们借助人工智能创建了此文章。您认为这篇文章怎么样？

很棒不太好

举报此文章

查看全部

How can you minimize shrinkage and maximize sales with balanced inventory levels?

1

2

3

4

5

6

1 Know your inventory turnover ratio

2 Conduct regular inventory audits

3 Optimize your inventory layout and security

4 Forecast your demand and plan your purchases

5 Implement inventory reduction strategies

6 Here’s what else to consider

Retail Operations

给文章评分

感谢您的反馈

更多Retail Operations相关文章

更多相关阅读内容