Inventrak Blog

In recent conversations with some merchants, when we asked what some of their top business priorities were, their answers were “customer retention”, “employee retention” and so on. We almost never heard “inventory management”.

When merchants think about inventory management, they agree that it is a headache when it comes to doing an inventory count; or sometimes, they try their best to avoid out of stock scenarios.  Some merchants think that these are the whole content of inventory management. 

However, do you realize that inventory is your biggest investment? According to Mark Steven, carrying inefficient inventory can eat up 20%-30% of your profits!

If you can reduce this investment and still keep your current sales, or if you can make this investment more efficient, you will be able to save or make more money!

Here are some tips to keep inventory lean and efficient:

Quick response: this helps you keep your inventory lean.  Quick response is to order minimum quantities of inventory in the beginning, and then to replenish the inventory based on your daily sales report.

Concentrate on core product lines: you can not be everything to every customer. Invest in your hot product lines (20/80 rules, 20% of your inventory generates 80% of your sales). Read your sales report to figure out what are your popular products and popular product lines.

Carefully test new product lines: from your sales report, you are not only able to identify your hot products, but are also able to know the attributions of these products. What color is selling? What styles are in demand? Based on these attributions, you can order new products and test the demand for these new products.