Best practices for supermarket inventory management
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January 6, 2021
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January 11, 2021Have you gone shopping in a supermarket and you walk with your trolley around the stands only to find all the shelves empty or barely filled? Or have you encountered a situation wherein you enter a supermarket, impressed with the discounts they offer only to find out that they ran out of stock only on the second day of the sale? As a customer, it leaves a very negative impression on you, and you would naturally avoid going to that place again. Now, would you want that to happen to you if the roles are reversed, and you become the owner of the supermarket?
Empty shelves and baskets in the store only indicate that you have nothing to offer. It might be the future situation as well because of the negative idea that is left behind in the minds of potential customers. These days both mid and large-sized supermarkets are facing grueling challenges owing to inventory management. Therefore, a supermarket owner needs to know how to control inventory and learn the inventory management system. Below are mentioned several action points you can apply to craft an efficient and reliable supermarket inventory management plan:
1. Adopting a reliable inventory management software
Proper management of inventory is the cornerstone of supermarket success. This is because it would mean that your customer’s greatly desired items are in stock, which will boost customer satisfaction, encouraging repeat visits.
Unlike the traditional method of keeping track of orders manually or through hearsay and guesswork, an inventory management software can forecast the products’ popularity based on the previous sales records and real-time reports. This will increase the chances of having products on hand and understanding what your customers want
without losing your precious customers to another merchant.
Adopting a Supermarket POS software will also efficiently decrease your storage cost. Storage spaces are expensive, and if you order an excess of inventory, you will have to pay more for space than what is needed. The POS system also records the entire inventory, making it easy for you to identify items that are moving off the shelves slowly, so you could either put them on for rapid sale or avoid reordering such products.
2. Fostering awareness about short shelf-life products
As a supermarket owner, you are aware that people would highly likely buy daily-use edible products such as vegetables, fruits, dairy, and bread only if they are fresh as they are not consumed stale.
Now the challenge lies in buying the right quantity of these products as you cannot keep them on the shelf for more than one or two days, and keeping less of these would mean a loss of sales. Therefore, it’s very important to take some measures to avoid spoilage by forecasting their demand. You can always keep a check on the ‘best before’ label on the
package. Other than that, you can keep these products on your inventory-balancing scheme by filtering them in a ‘sell-by date’ filter.
This will help you and your employees know which items are needed to be sold out first, and hence, you can control and flag any potential expiries. It is also very important to keep a check on the expiry date and make sure that you do not sell expired products to your customers. It will create a negative impression and lead to serious consequences.
3. Replenishing products in inventory based on groups
When you keep a close eye on the products, how they are sold, and the nature they possess, your inventory management and sales improve and show a significant upsurge. Sometimes customers enter your supermarket to purchase their favorite or regular brand they use.
However, if you run out of such a brand, your customer would not hesitate or give a second thought to buy an alternative brand of the same product. This behavior can be mainly seen in perishable products like bread or milk. For example, if your customer
prefers to buy bread from brand X and could not find it, he would not hesitate to buy the product of brand Y. If neither is found, then it can turn into a nightmare situation for both you and your customer.
However, this generally does not work for every product like personal care items such as shampoos or toothpaste. Therefore, to avoid the former situation, it’s always better to understand how products work in a group so that you can manage inventory accordingly.
4. Setting up priorities and goals
Running a supermarket and managing it is as tasking as any other business. Therefore, before the start of every quarter, it is important to have a meeting with your staff to discuss your sales goals. You can include important points such as the new products you are planning to introduce, who the new suppliers you would contract with for the supply of products. What specific products or brands you want to move off the shelf during the season, such as special cakes or pies during Christmas or special candies and assortment boxes during Halloween.
It will enable your staff to promote and refer those products to your customers, and you can make good profit margins and plan inventory accordingly. You might also need to set the balance right and prioritize your goals beforehand.
For example, if you wish to put the edible products on a shelf for presentation and also do not want to bear the spoilage cost of edible products, then you need to plan accordingly with your team to avoid any last-minute rush or loss.
5. Don’t throw away the traditional method of handling inventory
While it is true that the new system of supermarket inventory management is fast, reliable, and accurate, that does not render the traditional way of physically counting products completely obsolete.
Some aspects of inventory management require human efforts as well, for example, checking the physical condition of products whether they are spoiled, torn, or out of shape. Such products can be easily kept aside, and only the products that are in good condition make their way up to the shelves. You can enact a headcount along with your staff every week or month to check whether products are suitable for shelf presentation.
Technology would not be of much help in such aspects as they are not able to detect the damage in the packaging or product, which is an important aspect of satisfying your customers.
With the awareness of the objectives of inventory management and an understanding of how important it is for the successful running of the business, it’s time you adopt a computerized inventory management system coupled with traditional stock management for optimum results. Inventory management benefits are plenty, and to yield these benefits to its maximum capacity, upgrade and add the practices mentioned above for precisely and carefully applying inventory control norms and flourish the business.
