‘Out of stock’ – three words that cost retailers $630 billion each year. 57% of UK shoppers who are met by an out of stock sign at their chosen high street retailer either choose to look elsewhere or don’t buy the product at all.
For online transactions, the figure rises to 65%. Customers can be fickle. If they find a product out of stock in your store, it’s likely they’ll look elsewhere, giving your competitors a chance to win over their custom for good. Thankfully, most stock outs can be avoided with improved inventory management and customer service. These stock control tips involve improving the use of stock control software and altering processes to ensure that shelves are never left empty.
#1 Set up automatic orders and alerts
You probably have hundreds, if not thousands of SKUs in store. Manually keeping track of inventory levels for each of these items is perhaps impossible, or at least extremely time consuming. Stock management software certainly helps, but if you don’t make use of many of its functions, you might as well go back to pen and paper. Good stock control software will contain an automatic alert function, where you choose stock level thresholds for each SKU and, at the end of each day (or week), the software automatically creates reports to show you which items are below their threshold stock level. Next, you can create and send purchase orders from the report in just a few click – restocking suddenly becomes an easy part of your daily routine instead of a slog that no-one enjoys.
#2 Identify sales trends
Common sense tells you that DIY products sell fastest on bank holiday weekends and rock salt is in greatest demand when the first cold snap of winter arrives, but if you look more closely, you may find distinct, rather less obvious sales trends for other products. If you’re struggling with stockouts for a particular unit or product type, use your stock control software to take a closer look at sales trends. Is there a particular day of the week where sales are strongest and stock runs out before your next order is due? If so, perhaps you could adjust delivery times to ensure they arrive in advance of this busy period.
#3 Improving stock takes and inventory management
Whether your company carries out an annual stock take or uses regular cycle counts, inventory management is essential to ensure that your warehouse or store room isn’t filled up with dead or obsolete stock. Although your point of sale system records every sale and adjusts stock levels accordingly, accurate cycle counts are still essential. Make use of handheld scanners to significantly reduce human error when counting (and save time).
#4 Check processes and responsibilities
If you’re finding that stockouts remain a major problem in your business even after following the stock control tips above, you need to take a more thorough look at your processes. Create a quick flow chart showing every stage of the supply chain and restocking process and determine which staff members are responsible for ensuring each step goes smoothly. That includes making orders, checking that they’ve been dispatched and delivered when expected, counting stock as it enters the warehouse, printing barcodes, restocking shelves and carrying out cycle counts. You may find that certain processes are being neglected. For example, a new staff member may not have been fully aware of the tasks they needed to pick up from their predecessor. Good communication resolves these issues.
#5 Improve customer service
During busy periods, it’ll be a challenge to keep shelves stocked without affecting other areas of customer service, such as at the point of sale. Restocking usually comes secondary to serving customers (quite rightly), but as we mentioned at the start of this article, empty shelves cost sales. If possible, free up a staff member to patrol the shop floor and offer to help any customers looking lost. If they can’t find an item, the staff member can then check its stock level and delve into the back to retrieve it for the customer.
These stock control tips show that organisation and technology are vital if you are to avoid stockouts as a merchant. Looking to upgrade your point of sale and stock management software? See what Trader has to offer.
Trader is an easy to use electronic point of sale system designed for the unique requirements of building, plumbing and timber merchants, hardware and DIY stores in the UK and Ireland.
Our team are ready to help with any queries or arrange a demo for you.