Ahh, the appeal of new items. Or, the demands of your customer's ever-growing "wish list" items.
But, when you are also trying to control inventory, and keep turns up, the challenge is, "Really...which items should you buy?"
As many retailers are only too aware, if you are not vigilant, you may experience bloated inventories, which can cascade into cash flow problems very quickly.
Here are six key questions for you and your buyers to ask yourselves as you consider new items.
We think of it as an "entry exam" for merchandise.
Use them to quickly see, "Which items actually deserve to be in your store?"
New items? Of course. The customers always want what's new! But, too much of a good thing? Not any more!
Quick Quiz for New Items
Can my customers get this item at other stores in my market area?
YES? Careful; it probably has no pulling power.
Is this subject to a lot of price competition?
YES? Slow turners with weak margins are double trouble.
Does having this item in stock help me sell other higher-margin merchandise?
NO? If not, you may not need it.
Can I get faster delivery on this item than I am now getting?
YES? You may be able to cut back on your stock.
Do I order larger quantities of this item than I actually need in order to take advantage of price breaks?
YES? Caution advised. You may be coming out on the short end when you figure in all the costs of excess inventory.
Do I have an emotional attachment to this item that reflects my personal taste rather than a business-like response to my customer’s desires?
YES? Best to avoid it.