There is much enthusiasm coming out of the buying trade shows, and why not?
Attendance levels have been near to or better than 2019. Energy levels are high, and very contagious. A sense of urgency persists, due to past supply chain issues, emboldening the pressures from the vendors to "Buy now!"
Especially in today's environment, FOMO - the Fear Of Missing Out – can be a compelling sales pitch.
How to deal with this pressure, especially given all the headlines about a coming recession, or drops in consumer spending, or cautions about the need to control expenses, improve profits, maintain cash?
Here are two tactics to help you manage this. One helps monitor and control "How much to buy?" The other helps decide "What to buy?"
Managing inventory – arguably the #1 responsibility of a retailer – has been beset by a host of new and sometimes daunting challenges since 2020.
The last few months of 2022 only made matters worse. As supply chain issues seemed to subside, foreboding talk of a recession dominated, dampening customer spending.
Many retailers are feeling a bit over-inventoried as a result. Similar to that sense of having a few added pounds after the holidays.
In other words, a situation that is crying out for perspective. And The ROI has you covered on that!
This is the time of year when most retailers are scheduled to take their annual physical inventory count.
Along with that comes the interruption of daily lives, very serious attitudes of bookkeepers and accountants, and, of course, extra expenses. Oh yes, those!
Typically, preparing for and taking the item-by-item count involves a lot of emphasis on "Make sure to count everything. We don't want to miss anything!" This often-loud focus is true whether the counting is done manually, by scanning, or any other means. "We must count it all!"
Okay, but why? Why is it so darn important to count every last fish hook or candy bar or tube of lipstick?!
It helps to know why.
For most retailers, especially this year, reducing inventory is priority #1. With talk of a 2023 recession still in the air, lingering inflation driving up costs, and rising interest rates, cash is definitely king this year.
Time to revisit your year-end strategies for meeting your targeted ending inventory on December 31. If you are like many retailers this year, with plenty of merchandise in your stores, you know the challenge: how best to turn that inventory into cash? Quickly! Especially without looking like a distressed merchant.
Here's one answer for how to do that. Focus on improving the productivity of each shopper who comes to your store. That is, increase the IPTs (Items Per Transaction.) Make it easier, more compelling and more fun for them to buy more items from you.
Each year at this time, our thoughts turn to turkeys.
No, not the ones that will adorn many dining tables on Thursday. But the "turkeys" lurking amidst your inventory. You know; non-selling, distressed, slow-moving, old, unappealing leftovers among your merchandise.
But this year, frankly, our worries extend beyond the turkeys.
Here are some of the reasons why.
As a result, in this environment, consumers are scaling back their discretionary purchases, and/or choosing to spend on travel, dining out, or other experiences versus retail merchandise.
Not an upbeat prospect for retailers, is it?
Except for the lingering sugar high, Halloween is soon to be behind us. Retailers know what that means: on to the Holiday Season!
Of course, for most retailers that brings a major focus on sales.
But, savvy retailers are focused especially on the targeted ending inventory on December 31. Those retailers are carefully watching sales reports, and are poised for action.
You've seen all the headlines. Worldwide inflation. Dire warnings of a coming recession. Big time discounts at retailers due to boatloads of inventory. Amazon doubling down on their Prime Day(s) sales. Shoppers shopping early in anticipation of rising prices.
Shaping up to be yet another "unprecedented" Holiday season for retailers, isn't it?
And a wonderful opportunity for all merchants!
How best to start? Set the boundaries.
Next, establish clear routines for monitoring inventory levels.
Your results are likely to be consistent with these patterns.
Still less than $1 a day! 👀