Running out of stock on key products can be devastating for a retail business. For example, a pharmacist told me recently when I came to pick up medicine, "I asked a customer to come back because I didn't have the medication in stock. They came back. Later he came back with a different script and I didn't have that either, so he left and I never saw him again." Clearly, keeping enough stock of core products is critical.
However, this logic does not always apply to non-essential, temporary, or promotional items.
The Risks of Overordering
A while ago I remember Frozen II merchandise was taking off. While it was selling rapidly at first, soon demand dropped significantly. If a retailer had over-orders, they would risk being stuck with surplus stock that would have to be heavily discounted.
"There is a genuine danger that a retailer who over-orders will be left with product that needs to be heavily discounted to get rid of."
When Under-Ordering Makes Sense
In cases like Frozen II goods above, under-ordering may actually be the wiser move. Here are some benefits:
- Avoids surplus stock needing to be sold at a loss
- Creates product scarcity, increasing perceived value
- Gives a chance to explain high demand and offer to order more
- Costs less, so saving you money
Leveraging Point of Sale Software
Whatever your ordering strategy, having the right point of sale and inventory management software is essential. It provides visibility into current stock levels so informed choices can be made on replenishment orders. This helps minimize waste while preserving customer satisfaction.
Streamline your inventory management with a point-of-sale system that seamlessly automates reordering. Our solution empowers you to replenish stock frequently without overburdening your staff. Let us simplify your inventory management process.
Let us show you how our POS software can help you master retail stock management.