Inventory is a big piece of the puzzle. So is turnover. And we can’t forget salary reporting. Sometimes even the most confident of retailers can fail. Jane’s new spring merchandise flopped after 6 months, thus she lost over 50% on ROI. John didn’t keep a hawk eye on his inventory and as a result, the store’s turnover score was under 2.0. Maria didn’t keep track of her employee clock-ins which skyrocketed major salary costs. Whatever scenario it may be, we’re sharing the key retail habits that counteract profit leaks.
Customer’s Choice > Yours
Unfortunately, what you think will sell doesn’t and what you hate sells big time. For example, a buyer invests 1000 USD in merchandise and places it on the sales floor for 6 months. But the investment hasn’t grown and continues to shrink after 12 months. Now the buyer has lost vital space on the sales floor and lost more than half of the initial investment. Ultimately, this halo effect based on poor decision making has left the buyer in shambles. The lesson to be learned is- leave room on the floor for better merchandise and always invest in the customers’ choice.
Monitoring the Turnover on a Micro Level
Calculating the annual turnover rate always depends on a combination of sales. Types of sales vary from the campaigns such as: seasonal, obsolete, flow method, bulk merchandise, etc. The simplest way to calculate turnover is taking the last year’s total sales and dividing it by this year’s ending inventory value. Making little tweaks in habits can have major impacts on the year’s inventory figures.
1. Start by micro-managing the inventory on a quarterly basis by monitoring the items lost. Items lost could be due to internal or external theft so make sure your security is on top of things.
2. Monitor the delivery dates when the merchandise arrives and keep track of sales campaigning with a sixth sense on timing. For example, offer steady prices for an extended period of time vs selling quickly on marked down bargain prices at the end of the season.
3. Keep track of merchandise reporting. Your staff should constantly clean the store to make it tidy. Don’t report items missing when they are simply misplaced. Likewise, don’t buy new stock on items you already own.
Report Salary Precisely With Real-time Clock-in Device
Depending on what you use for scheduling, always track how many hours your employees really account for in the system. Clocking-in the precise hours with a real-time solution can accurately account for the salary costs. For example, registering an extra 10 minutes can’t hurt on a one-time basis. However, multiplying the number of employees that clocked with rounded up hours can add significant losses to your budget!
Remember, investing in a real-time clock-in system is necessary in order to keep salary costs low. Consider a system that is mobile too because technology has caught up with a clock-in/out to a specific IP address in order to ensure that employees are actually present. By comparing clocked hours with scheduled hours, the system’s salary reporting will highlight deviations as well as suggest a payroll adjustment based on employee reasons for absences, lateness, etc.
See our checklist on finding the right employee scheduling system that can meet your retailing needs.