Uncover Inventory Control
As a furniture retailer, your most important tangible asset is your inventory. There are many opportunities to enhance the level of control you have over your inventory to achieve success.
That being said, almost 50% of retailers in the US, especially small businesses, have no processes or technology in place for inventory management. And the numbers show that retailers sit on $1.46 in inventory for every $1 they sell. There has to be a better way!Capterra
Luckily, here at STORIS, we have expertise in how you can successfully manage your inventory that we’d like to share. In fact, we help retailers achieve 99% inventory accuracy, reduce broken promises to customers, and run overall efficient operations. In our infographic, we take you on a step-by-step journey of our retailers’ best-kept secrets for inventory excellence.
Start With Your Team
A great place to start is to keep standards high by maintaining a clean warehouse. This attention to detail sets the expectation for employees that any product or procedure that does not conform to an organized standard is unacceptable. Maintaining an organized warehouse makes it clear employees are accountable.
Train for Success
Train employees to succeed at their specific job function. Use test scenarios to practice job functions and ensure they are comfortable handling processes before working with your actual inventory. As far as technology, build menus so that each employee can easily access the tasks they need daily. Train them on how to use reporting to track the jobs they completed.
As a manager, monitor your team’s performance with audit logs. This supervision encourages your team to develop good habits. If you notice unusual patterns of behavior, don’t let it go. Investigate and devise solutions.
Track with Precision
Maintain real-time updates for your entire inventory including quantities and statuses across your supply chain. By integrating your logistics, sales, and purchasing data, you can develop a clear picture of your inventory at all times. When you have this inventory insight, you can make strategic decisions to increase sales, quicken turns, and grow profits.
Consolidate Across Channels
Integrate all of your channels of inventory for a true picture of your business. These include all store and warehouse locations, your eCommerce platform, and mobile POS devices. Save time and have accurate information by managing a single database across all.
Make Important Adjustments
Your processes for making stock adjustments should be user-friendly and efficient. Every business is dynamic and being able to make changes to your inventory without impacting data precision is critical. This includes quantity adjustments, product statuses, prices, discounts, transfers, write-offs, vendor charge-backs, special order details, and more.
Maintain with Ease
Entering new inventory into your system or making mass adjustments doesn’t need to be a tedious, manual process. Use Conversion Spreadsheets to import hundreds of items all at once. You can use spreadsheets continually to update promotional prices, change descriptions, assign collections, and more. Inventory management should be an ongoing process that you can easily manage.
Receiving inventory is all about speed and precision. Record merchandise as soon as it arrives on the dock. Check to make sure there are no damages from previous shipping and handling before you accept the merchandise to avoid having to mark down damaged items later. Be aware of expected deliveries each day to have your warehouse properly staffed. If items are delayed, research any issues to ensure successful receipt as soon as possible.
Make sure that the customer receives what they ordered when picking your merchandise and putting it on the truck for delivery. The software can help you determine the fastest path through your warehouse to locate the merchandise. This will save you time, electricity, and gas. Determine the most efficient routes around your warehouse to avoid multiple passes. For multi-carton items, place all the boxes for that item in the same location to reduce having to hunt down any missing boxes.
Transfers & Movement Tracking
Every time you move a piece of inventory, whether it is a transfer between stores or warehouses or a movement within your same warehouse, make sure you record the movement. This avoids confusion and helps you find what you are looking for.
Maintain the integrity of inventory with frequent cycle counts. A cycle count involves counting and auditing a portion of your inventory on a specified day. Throughout the year retailers will cycle through their entire warehouse. This process allows you to identify poor procedures, mistakes, and discrepancies within hours or days. Because you are not only monitoring inventory once a year, your inventory accuracy is greatly increased. This constant analysis also keeps employees using best practices in their day-to-day activities.
Perform Annual Full Physical Inventories
It is suggested that retailers perform a Full Physical Inventory where each piece of inventory is counted and checked at the end of your fiscal year or for some retailers, after every quarter. For retailers with inventory issues, it is suggested to do a full physical more often so you can calculate accurate shrink numbers and research the causes to strategize corrective actions. When completing a full physical start fresh with accurate inventory quantities and general ledger values.
Implementing barcode scanning allows for precision when managing your inventory. It helps your organization to maintain accurate data and increase the efficiency of related tasks including receiving, transfers, cycle counts, and full physical inventories. There are two types of barcode scanning typical to the industry; batch and radio-frequency. Both systems allow you to receive merchandise, easily perform cycle counts and physical inventories as well as Bin to Bin Transfers. Radio Frequency has additional functionality such as picking for deliveries and transfers.
Organize Your Warehouse Structure
Establish a system for how you organize your warehouse structure. Retailers find success using a mask 01-A-01 code where the first number represents the aisle, the letter represents the level, and finally, the third number represents the row. As a rule, store large items and high-velocity items on the ground level. Designate areas for specific products or categories. Some retailers assign a Priority Picking area to move specific pieces quicker.
Maximize Storage Capacity
Direct Putaway is a popular warehousing tool used by high-volume retailers. It can help you position merchandise in your warehouse in a manner that improves space utilization. Preset products, stores, and warehouse locations with locator tracking and dimension data. You can then use these settings to auto-direct product placement instructions.
Auto-Plan Daily Activity
Tools are available to increase warehouse productivity and reduce necessary supervision. You can use advanced task scheduling to send daily assignments directly to your team’s barcode scanners each day. This includes auto-directed actions and inventory workflows to streamline their operations.
Design labels with valuable information for products to help identify each piece easily. Include images, special order details, pricing & clearance information, and notes on damages to assist with merchandise organization. Technology that is integrated with a Forms Designer tool allows you to make unique, branded showroom floor tags, POS labels, inventory barcodes, receipts, and documents for purchasing, receiving, and distributing inventory.
Utilize Manifests and Pick Lists
Create documentation that assists in accurate inventory distribution. Pick Lists organize merchandise that needs to be included on trucks for specific routes, while Delivery Manifests include details such as Cash on Delivery amounts to ensure drivers have accurate information to complete the delivery successfully.
Set Up Prepping Stations
Prepping inventory for delivery is an important step in the furniture industry. For some retailers, the process may involve multiple steps including prep, staging, and checkpoints for loading deliveries. Have clearly designated areas and teams assigned to each stage to help get the merchandise ready to go efficiently.
Capitalize on Best Sellers
Identify top-selling items with reporting to know where you are making the most money. Generate ideal merchandise recommendations by analyzing your data by vendor, item, category, collection, selling location, and more. These insights allow your merchandising team to make strategic choices. Keep those items in the most efficient place in your warehouse near the docks for delivery to minimize time picking your high-velocity products. Conversely, place slower turning items at the back of your warehouse.
Use the Just In Time Method
Reduce on-hand inventory using the Just In Time Inventory method. Purchasing is completed for stock items on an ‘as needed’ basis minimizing time in your warehouse and improving cash flow. Purchase Lead Times and Auto-Fill inventory reservation days are used in conjunction with buying recommendation reporting or purchasing replenishment. This is how technology can alert you of the ideal time to purchase inventory to fulfill sales, but not over-carry products.
An effective way to manage inventory flow is the First In, First Out method. This reduces the age of inventory across your accounting and maintains accurate valuations. By calculating cost by the oldest purchased piece compared to the current selling price, you can secure ideal margins.
Automatically reorder your best-selling, staple items. Set up trigger quantities by either minimum or safety stock levels to alert your buyer’s attention once supplies fall below the targets you have set. Configure target quantities by location, so slower selling stores do not have to get as much inventory as top-performing locations.
Restock for Backorders
Replenish inventory for backorder needs to automatically generate a purchase order for a sale where the item is out of stock. Technology can also cross-reference stock across locations and automatically transfer to get these quantities out to the store in need.
Manage Successful Deliveries
Deliveries are the primary method of fulfillment for home furnishing retailers and an important step in the flow of your inventory through your company-wide logistics. Make the coordination of your deliveries easy for your team. Establish capacity rules for your routes to make sure the stops can be realistic, which cuts back on error and saves time back-tracking. Reference route cutoffs in real-time at the POS to accurately schedule to open delivery times.
There are many elements that impact the effectiveness of your inventory control. From your daily processes to running a more efficient warehouse to motivating a productive team, just trying some of these tips can help you see improvements in your operations.
Want to learn more about how a retail solution can help your business achieve inventory success?