Three Reasons to Begin Inventory Planning Early
The ball dropping signifying 2014 can only mean one thing for retailers, time to take a (dreaded) inventory. As you get ready to scan, count and reorganize, we would encourage you to add one more thing to your “to do” list…start your inventory planning.
You’ve been saying it for years that this is going to be the year you start planning and take control of your inventory. Our (matter of fact) response: DO IT.
Every month and every year you don’t look critically at your inventory, you are missing huge opportunities. You are missing the opportunity to identify key growth prospects and challenges. You are missing the opportunity to take control and have a plan. You are missing the opportunity to do more volume. And, last but not least, you are missing the opportunity to bank more cash, just by making wiser decisions about what (and how much) you are buying.
If we had to highlight the “big three” reasons that you should think about inventory planning in 2014, we would say the following:
- Inventory planning ties purchases to plans and performance and creates accountability and empowerment. It highlights where you can do more sales on less inventory, thus helping your top line. It shows you what classifications are working, and what classifications are falling flat, and together, we answer the big “why” and come up with a game plan. And imagine taking that game plan to market, and having an actual budget that tells you how much by classification (by month!) you need to buy to drive your business. Life changing.
- Inventory planning allows for a real-time reaction to your business and helps you make sound decisions on your feet. As a buyer, you most likely have the “art” side down…adding the science (aka the numbers) allows your decisions to come to life. Planning also make you accountable.
- Inventory planning makes you a proactive buyer vs. reactive buyer, which is better for all parties involved (and can give you some serious leverage with your vendors).
We’ve said it before, and we’ll say it again, planning allows you to see what’s going on in your store…impartially. The numbers show you what is selling and what needs to be marked down and moved out to give you room to bring in fresh products that people would want to buy. Yes, planning is structured, but it also allows you wiggle room to adjust as needed. Having an inventory plan allows you to see when you need to turn and when it is time to infuse the store with new inventory — it makes you a more conscious buyer. All these things, coupled with a little retail therapy, from yours truly, go a long way to impact your store.
Not sure you’re ready to take the plunge? We are happy to connect you to some of our planning clients, and they can tell you the impact having a plan made in their 2013, and what they look forward to achieving in 2014.
Our goal for 2014: show you the difference planning can make, in any size store.