Reducing Out of Stocks at your store
Reducing out of stocks at your store
Having out of stocks on those popular selling items can be an absolute nightmare for some retailers. And it is for good reason. Out of stocks can create a domino effect within your business. Not only will it lead to a loss of a sale or sales but it can reduce your customer satisfaction levels and lead them to look elsewhere for that product. Although you can always try and offer your customers a relative substitute. And while some will appreciate this gesture, if they are after something in particular they could leave disappointed. So this is not ideal, especially in an industry that is so competitive on prices and range. Your service could be your defining quality, therefore these out of stocks need to be avoided.
The scary statistics on Out of Stocks are that 83% of customers will choose not to return shopping at your business because of out-of-stock items. So with this risk at an all time high factoring upon some empty shelf items
Sometimes out of stocks can not be avoided, especially when your supplier is out of stock, but there are a few solutions you could look to implement that could help you avoid the out of stocks within your store.
Stock on Hand Quantities
This is an easy aspect of your business that can run into inaccuracies due to numerous reasons. Your store can face issues when variances in orders happen, damaged stock, theft, returns or lost items, and as such can lead to a difference with your physical stock numbers and the numbers you have in your system, or on paper.
This is an important area to tackle because it can lead to over ordering, under ordering (if you rely on your on-screen numbers), and can impact your cash flow and finances if you order the wrong products.
Some ways to avoid this from happening
Use your POS to manage your inventory levels
If you are wanting to take a step in the direction of avoiding discrepancies with your physical and on-screen figures then implementing a proper inventory count is number one. This is where you could be Using your POS system to track and manage levels which can help you save time and reduce the hand written mistakes that can happen if you use pen and paper.
Setting up your stock correctly within your Point of Sale system is number one and then it will require maintaining this level when reordered stock actually arrives. Controlling your stock using your POS can be a powerful time saving tool that can help your business avoid the negatives that happen as a result of out-of-stocks.
Automate Inventory Tracking
Once you have established your initial stock counts, you can manually set reorder points within your system so you get an alert when that items reaches its physical minimum. This can be extremely beneficial when your store carries a large range of different lines and with Epos Now you can also create automatic Purchase orders straight out of the system that can save more time.
Allow time to receive stock
Re-ordering your stock when it’s flying off the shelf is the general rule when dealing with out of stocks, but making sure you are getting to that reordering point in time to replenish your shelf before it’s bare and allowing for processing times is important.
This is where you can look to utilise your POS system and search for trends on those particular items that you may be repeatedly selling out of. You may discover from looking at daily sales reports that the particular item is more popular on certain days and thus you can use this to calculate the most effective day to reorder.
Historical data can be extremely effective when looking to forecast future sales and demand for a product which can help you avoid out of stocks. This is especially the case when it comes to ordering for busy times of the year like Easter and Christmas. Retail orders for these times of years are very specific and generally done well in advance, sometimes even 10 months prior. In these instances you can try and rely on your memory and judgement of previous sales but ultimately your POS sales reports will be the most effective way to avoid over or under ordering.
Know your Suppliers
Another handy tip is to know your suppliers. Knowing exactly when order deadlines are, how long it takes to for stock to arrive are crucial when determining the ideal reorder point. Some vendors may be local and have minimal time from order to delivery, but others could have a long lead time as they could be interstate or even international. Factoring in these times and variables is another important element, and one you can also try and set up with automated alerts in POS. Armed with delivery time line information, and an evaluation on selling point trends, the automatic reorder point could be altered to ensure you have enough stock to hold you over until the next order has time to arrive.