As a programmer specialising in retail and Point of Sale (POS) systems, I recently embarked on an intriguing experiment: using ChatGPT to create a dashboard without relying on my programming skills. Much discussion has been about ChatGPT enabling non-programmers to write code, with dashboards often highlighted as a key example. I decided to test this claim, and the findings were illuminating.

What's a Dashboard, Anyway?

A dashboard is a visual display that displays important information, commonly called Key Performance Indicators (KPIs). These provide a quick visual overview of the current situation, helping us make informed decisions without the need to sift through large amounts of raw data.

For retailers, dashboards transform massive sales data into actionable insights in seconds.

The Experiment: Following a Non-Programmer's Guide

To simulate the experience of a non-programmer, I followed a YouTube tutorial that promised to teach dashboard creation using ChatGPT.

So, I selected this YouTube here. Please feel free to consider this article as my response article to it.

So, I started with data from our POS software's Sales Report, which has comprehensive insights.

The ChatGPT Experience: Not Quite as Advertised

Data Wrangling Woes

My first hurdle was getting the data into the correct format. While our POS system can export to JSON, I followed the tutorial's suggestion. Later, I found that I had made the correct decision as I would dive into Excel many times to manipulate the data. It became a recurring theme throughout the process.

Paid Account Required

Contrary to the tutorial's claims, I quickly discovered that a free ChatGPT account wouldn't cut it. The credits ran out faster than a sausage sizzle on a Saturday morning. The experiment would have ended if I had not had access to a paid account. Let me know if anyone wants a paid account, and I offer reasonable offers. So, I switched to the paid account to continue this experiment.

Dashboard Dilemmas

After multiple attempts, I managed to create a basic dashboard. However, getting it to look presentable was another story entirely. As any retailer trying to spruce up their shop window knows, making things look good is most of the work.

Real-World Retail Challenges

Then, I ran into the problem of using real-world retail data in an experiment. In business, things are not cut and dry. I would encounter these problems here.

Consignment Stock

Items on consignment threw off profit calculations, as they had no listed cost.

Gift Cards

These presented a similar challenge to consignment stock.

Payouts

While these transactions affect sales numbers, they don't contribute to profit.

I only discovered these issues through this exercise, and it took time to learn these problems each time. The solution was to return to Excel, adjust the data, and recreate the JSON file. It was like constantly restocking shelves but with numbers instead of products and then recreating the dashboard.

The Programming Plot Twist

By now, I had spent many hours. So, when trying to calculate the total profit, I hit another wall. After many attempts, I had enough, so I resolved this by going outside the tutorial's framework. I had to break character and lean on my programming expertise. I delved into the HTML code generated by ChatGPT to understand what was happening behind the scenes. Only then did I finally wrangle the dashboard into something usable!

Now I had this, I could select a department, and it would give me these figures and charts.

Now I had something, but were the figures correct? After five hours of this exercise, I did not check, so it was unusable. In programming and business, it's rarely worth it for one-off jobs. You need stuff that, once done, repeats. Here, you must massage the data extensively before using it. The Bottom Line

It was presented as a quick and easy project for someone with moderate computer skills but turned into a time-consuming ordeal that required the following:

• Over five (5) hours of work
• Extensive Excel manipulation
• The ability to read and understand HTML code
• A paid ChatGPT account

Even after all that, I hadn't yet verified the accuracy of the figures—a crucial step that would likely take many hours more if they were wrong.

Lessons 

While quickly creating custom dashboards is appealing, the reality is not yet here.

Today, retail success depends on turning sales data into actionable business insights. Follow this guide to use tools to make data-driven decisions that significantly impact retail performance using POS Systems.

Accessing Your POS Gold Mine

Your point-of-sale (POS) system has a Gold Mine of data. Here's how to access your sales comparison reports:

1. Open your POS software and navigate to the Reports section.
2. Select the Sales option.
3. Look for the Compare feature to analyse different periods side by side.

Setting Up Your Comparison: The Foundation of Insight

When setting up your comparison, you have two main options:

1. Formal Date Ranges: Use standard periods like months or quarters for consistent reporting.

2. Custom Date Ranges: Select specific dates (e.g., 06 Nov 2024 to 05 Dec 2024) for more targeted analysis.

Pro Tip: Choose comparable periods for meaningful analysis. For example, compare:

• This year's holiday season to last year's
• This quarter to the same quarter the previous year
• Weekends vs. weekdays

By selecting similar business cycles, you'll gain the most accurate insights into your performance trends.

Analysing the Report: Your Retail Crystal Ball

Your comparison report offers a wealth of information:

Overall Performance Metrics

• Sales figures for each period
• Revenue generated
• Quantity sold

Department-Specific Insights

• Performance comparisons across departments
• Individual department deep-dives

Pro Tip: To analyse specific departments more thoroughly, click on them in the left-hand menu.

Understanding POS Data Export: Unleashing the Power of Excel

To gain additional insights, export your data to Excel. Follow these steps:

1. Click the export button in the top left corner of the report.
2. Choose Excel as your export format.
3. Open the file in Excel or OpenOffice (a free alternative).

Once you've got your data in Excel, you can dig deeper.

Actionable Insights from Reports: Beyond Sales Comparisons

Your POS system is a goldmine of retail intelligence. Beyond sales comparisons, consider exploring these powerful reports:

• Top-selling products analysis: Identify your star performers and potential areas for expansion.
• Inventory turnover tracking: Optimise stock levels and reduce carrying costs.
• Customer purchase history: Tailor your marketing and loyalty programs for maximum impact.
• Staff performance metrics: Improve scheduling and identify training opportunities.

Turning Data into Dollars: From Insight to Action

Now that you've gathered insights from your POS reports, it's time to put them into action:

Identify top performers

Optimise the placement of your best-selling products in your store layout.

Adjust inventory

Use turnover data to fine-tune stock levels, reducing overstock and stockouts.

Refine marketing

Leverage department performance comparisons to allocate your marketing budget effectively.

To consistently enhance your retail performance, regularly examine your data, experiment with new strategies, and evaluate the outcomes.

Your Next Moves: Turning Data into Profit

Start harnessing the power of your POS data today:

1. Generate a sales comparison report for the last two months.
2. Identify your top three performing products or departments.
3. Create one actionable strategy based on your findings.
4. Execute your strategy
5. Monitor the outcomes.

Your POS system can be your gateway to success in retail.

Frequently Asked Questions

Q: How do I access sales comparison reports in my POS system?

A: To access sales comparison reports:

1. Open your POS software
2. Navigate to the Reports section
3. Select the Sales option
4. Look for the Compare feature to analyze different periods side by side

Q: What types of date ranges should I use for comparisons?

A: I suggest using formal date ranges, such as monthly ones. Custom date ranges (e.g., 06 Nov 2024 to 05 Dec 2024) are for ad hoc analysis.

Q: What key information can I find in a sales comparison report?

A: Sales comparison reports typically provide:

• Overall performance metrics (sales figures, revenue, quantity sold)
• Department-specific insights
• Performance comparisons across departments

Q: How can I analyse my POS data more in-depth?

A: Export your data to Excel or a similar spreadsheet program. This allows you to perform custom calculations and create tailored data visualisations.

Q: Beyond sales comparisons, what other reports should I explore in my POS system?

A: Consider exploring reports on:

• Top-selling products
• Inventory turnover
• Customer purchase history
• Staff performance metrics

Remember, consistent analysis and action based on your POS data are key to optimizing your retail operations and boosting your bottom line.

Poor inventory management has been shown to cause retail businesses to lose up to 30% of potential sales during the Christmas rush. With only a slight delivery delay and unpredictable buying patterns, maintaining optimal stock levels becomes a challenge for retailers. Mirror marketing offers a proven solution to these challenges.

Understanding Mirror Marketing

Mirror marketing is a proven methodology for inventory management. It compares historical sales data with current inventory, which helps retailers maintain optimal stock levels. It identifies potential stock gaps before they become problems, ensuring you're well-prepared for upcoming sales periods. For example, a retailer can compare last December's hot-selling items against current stock levels to prevent shortages of popular gift items.

The foundation of mirror marketing lies in its systematic use of historical data analysis. Industry data shows retailers implementing mirror marketing achieve an average 25% reduction in stockouts during peak seasons.

The Power of Historical Comparison

Recent studies have shown that nearly half of all retailers experience significant stock shortages during Christmas. However, historical data analysis has proven to improve forecast accuracy by up to 40%. Most importantly, retailers who properly manage their inventory through mirror marketing techniques have reported increased holiday sales.

Mirror marketing helps identify items popular during previous periods but not currently selling - often because they're out of stock rather than due to decreased demand. This insight is invaluable during the holiday season when customer demand fluctuates dramatically.

Implementation Strategy

Setting Up Your Reports

Now, here is a step-by-step method for doing it.

Go to Register Reports marked in green.

Now select in stock, "Stock Sold During Period(a) Not Sold in Period(b)"

The report tells us what was sold in a previous period (a) last year but has not sold in this period. The reason often is you have run out of some stock lines.

So we put in the dates for the last seven (7) days of the previous year.
Then we put in the dates to compare with last week.

You will now be confronted by many different options, but let us keep it simple, so ignore them and run the report. Check the report showing the listed stock lines.

Monitoring and Analysis

Successful implementation requires consistent weekly inventory analyses and daily monitoring of trending items during peak seasons. Maintaining detailed historical records and acting on report insights within 24 hours of generation prove essential.

Holiday Season Strategy

The Christmas period demands increased vigilance in inventory management. Daily report checks are often necessary to capture seasonal trends effectively.

"Retailers using mirror marketing during peak seasons typically see a terrific improvement in stock availability and an increase in sales conversion rates."

Success Metrics and Implementation

Implement these mirror marketing strategies to transform your holiday inventory management today. Proper planning and systematic monitoring will help ensure a successful Christmas season.

Frequently Asked Questions About Mirror Marketing

Q: What is mirror marketing?

A: Mirror marketing is an inventory management methodology that compares historical sales data with current stock levels to optimize inventory. It helps retailers prevent stockouts by analyzing past sales patterns to predict future demand.

Q: What is the difference between Order Management Systems and inventory management?

A: Order Management Systems and Inventory Management serve different purposes:

Q: How effective is mirror marketing for retail businesses?

A: Mirror marketing has been shown to reduce stockouts by approximately 25% during peak seasons and can help prevent up to 30% loss in potential sales during Christmas.

Q: What reports do I need to run for mirror marketing?

A: To implement mirror marketing, you need to:

• Access Register Reports
• Select "Stock Sold During Period(a) Not Sold in Period(b)"
• Compare the previous year's data with the current period
• Review stock lines that show discrepancies

Q: How often should I run mirror marketing analyses?

A: For good results:

• I recommend every week over Christmas
• Review reports immediately as the information is current 

Q: Can mirror marketing improve holiday season sales?

A: Yes, retailers using mirror marketing during holiday seasons typically experience:

• Improved forecast accuracy
• Better stock availability
• Increased sales conversion rates

Q: What are the key benefits of mirror marketing?

A: The main advantages include:

• Prevention of stock shortages
• Early identification of potential inventory gaps
• Improved seasonal sales performance
• Better prediction of popular items

Q: How do I get started with mirror marketing?

A: To begin implementing mirror marketing:

1. Create regular monitoring schedules
2. Act on insights immediately

Q: Is mirror marketing suitable for all retail businesses?

A: I cannot see why not, as mirror marketing can benefit any retail business that:

• Experiences seasonal sales fluctuations
• Maintains inventory records
• Has at least one year of historical sales data
• Wants to optimise stock levels

We are all balancing inventory—excess stock ties up capital, while insufficient stock can result in lost sales opportunities.

Here is a simple key to improving your stock control that is available now, and it will boost your bottom line.

Understanding the Power of Historical Data

Big suppliers don't just guess about stock control—they rely on historical data. They compare monthly sales year over year to identify trends and patterns. They tend to use 24 months of your data, which helps them account for seasonal fluctuations and make more accurate predictions.

But with a modern POS system, you've got all the tools you need to play in the big league.

Why Your POS Data is Gold

Your POS system isn't just for processing transactions, it full of valuable information. Here's why it's better for you than your supplier's information:

Real-time sales data

Unlike your suppliers, who only see what you've ordered, your POS system shows exactly what you've sold.

Seasonal insights

By comparing data from the same months across different years, you can spot seasonal trends specific to your business.

Stock level optimisation

With accurate sales data, you can decide how much stock to hold.

How to Use Your POS Data for Better Stock Control

Let's walk through a practical example of how you can use your POS data to improve your stock control:

Access your sales report

You'll find this under 'Reports'> 'Sales'> 'Stock Sales Details 24 Month Trend'.

Filter your data

For this exercise, we'll keep it simple:

Exclude inactive stock Filter by department or supplier

Analyse the trends

Look for patterns in your sales data. Are certain items consistently selling well? Do some products have seasonal spikes?

Evaluate stock levels

Compare your current stock levels with your average monthly sales. Do you need to be more overstocked on slow-moving items?

Case Study: Spotting Overstock Issues

Let's look at a couple of examples from our report:

Product A

Average sales: 2 per month Current stock: 6 units Stock cover: 3 months. If you can reorder this product weekly, holding three months of stock might be excessive. Consider reducing your stock levels to free up capital.

Product B

Average sales: 0.5 per month (1 every two months) Current stock: 16 units Stock cover: 32 months (nearly three years!) This is a clear case of overstocking. Unless there's a specific reason for holding so much stock (like a bulk discount or upcoming promotion), you should look at significantly reducing your inventory of this item.

Turning Insights into Action

Now that you've got this knowledge, here are some steps you can take:

Adjust your reorder points

Use your sales data to set more accurate reorder points for each product.

Negotiate with suppliers

Armed with solid data, you can better negotiate order quantities and frequencies with your suppliers. In my experience, most suppliers will listen to you if you have an issue.

Plan for seasonality

If you spot seasonal trends, plan your stock levels accordingly.

Clear out, slow movers.

Identify products that aren't selling well; now you have something to think about and what to do with them.

Focus on your winners

Make sure you're well-stocked with these winners.

The Bottom Line

Leverage your POS data; don't guess. Make informed decisions about your inventory. This approach can help you: Reduce tied-up capital Minimise storage costs Avoid stockouts of popular items With your cash flow

Your POS system is a powerful tool that gives you the information you need to compete.

Our POS software makes it easy to access and analyse sales data.

Contact us to learn how we can help you optimise your stock control and boost your profits.​

Once a fringe holiday, Halloween has now become a significant retail event in Australia.

The Rise of Halloween Down Under

Halloween has become a frighteningly big business in Australia. This year, expected: 

• A whopping 21% of Australians are expected to celebrate Halloween
• Total retail sales are forecast to reach $450 million
• The average Aussie Halloween enthusiast is set to spend $93

Who's Driving the Halloween Craze?

Interestingly, it's not just kids fuelling this trend. Adults aged 35-49 are the most enthusiastic Halloween celebrators, with 40% planning to join the fun—a 3% increase from last year!

Top-Selling Halloween Categories

The retail industry expects these categories to sell, so look for top Halloween products here:

What sells in your shop

Go to your POS system into Register Reports

Select "Top N Stock Sales for a Given Period"

In the form, put in the following dates: 25/10/22 to 31/10/22. A report will come out with what is sold over that week. 

As time is running out, could you do it now?

This data-driven approach has helped you avoid overstock nightmares and check that you have the products sold in your shop on Halloween.

Here are some more ideas to consider.

Devilish Decorations

The trend is now that Aussies are getting more creative with their Halloween decor each year, turning their homes into haunted houses.

How about considering:

• Halloween paper plates, cups, and napkins
• Spooky banners
• Balloons
• Creepy cocktail accessories (skull ice moulds, witch's brew punch)

Trick-or-Treating Essentials

The tradition of trick-or-treating has taken off in Australia, so you may want to consider:

• Plastic pumpkin buckets for collecting treats
• Glow sticks and light-up accessories for safety
• Halloween-themed bags and baskets
• Face paint and temporary tattoos for quick costume touch-ups

Navigating the Challenges of Halloween Retail

In retailing, Halloween can be challenging. Here is what I've learned over the years:

Start Now

There is a limited amount of time to begin planning your Halloween stock. Look for something original.

Manage Stock Carefully

Many Halloween items have a short shelf life. You do not want to be stuck with difficult-to-sell Halloween-specific items after October 31st. The odds are you have to put them in storage for next year or sell them at a discount.

Advertise

Put up signs or stands in front of the shop. If you have an Instagram or Facebook page, use it to show your Halloween products and create buzz.

Conclusion: Embracing the Halloween Spirit

Halloween is worth looking into.

FAQs about Halloween in Australia

Q: How big is Halloween in Australia?

A: Halloween is growing in popularity across Australia. Over 5 million Aussies, or about 1 in 5 people, celebrated Halloween this year. Social media and fun family activities fuel interest, so we can expect the numbers to keep rising.

Q: How big are Halloween sales?

A: Halloween spending totaled $430 million in 2022 and jumped to $490 million in 2023. Early estimates for 2024 put spending around $450 million.

Q: How much money do Australians spend on Halloween?

A: Halloween retail trends are up. Today's average spending for a person celebrating Halloween is expected to be $93, an increase of $7 (8.1%) from last year.

Q: What sells the most for Halloween?

A: Halloween sales Australia, top Halloween categories that Australians spend on include:

1. Trick or treating (45%)
2. Treats for trick-or-treaters (38%)
3. Halloween costumes (37%)
4. Home decorations (32%)
5. Attending or hosting events (18%)

Q: Which product category has the most sales for Halloween?

A: The top-selling product category is trick-or-treating gear, with 45% planning to buy these supplies.

Q: What age group spends the most money on Halloween?

A: Australians aged 35-49 comprise the biggest spending age group at 40%, followed by those under 35 at 25%.

Q: Is Halloween getting more popular in Australia?

A: Yes. This year, 300,000 more Australians will celebrate than last year, and it is showing steady growth in popularity.

Father's Day is almost here. I hope you are prepared as it retails a golden opportunity, so please do not waste it. Let's dive into how you can use your point of sale (POS) software to maximise your sales.

Background this Father's Day

According to recent data, Australians are set to spend a lot. $820 million on their dads this year. That's a lot of potential sales to go around! Here's what people are buying now:

1. Alcohol and food (34%)
2. Clothing, shoes, and sleepwear (15%)
3. Books, games, and music (15%)

While that's exciting news, the figure itself is slightly down last year, with the average person shelling out $101 instead of $112, but last year's figure was outstanding, so don't worry. 

Insights from the GiftFair

At the GiftFair in Melbourne. Suppliers seemed to be pushing items for Father's Day, these items:

• Beer steins and unique drinkware: Perfect for dad's favourite brew!
• Quirky socks: Because who doesn't love fun feet?
• Male grooming items: Help Dad look his best. I do not know how it will go in Australia, but retail publications in the UK are now saying they are doing well in retail shops.

Using Your POS System to Boost Sales

Check What Worked Last Year

The fact is that we are creatures of habit. What worked well last year often works this year. Do you remember last Father's Day? What sold well but didn't work? Your POS Software does! Use the "Top N Stock Sales for a Given Period" report to see last year's sales. 
 

Go to Register Reports.

Now pick "Top N Stock Sales for a Given Period."

In the form, put in today's and day-a-week's search and check it out. That will give you what worked last year. Make sure that these items are noticeable in your shop now.

Create Irresistible Bundles

Use your POS to create and track gift bundles. Maybe a "Beer Lover's Bundle" with a fantastic Stein and local brews? 

Offer Early Bird Specials

Did you know that 10% of shoppers have already bought?  The odds are now people are buying for Father's Day.

Making Shopping a Breeze

Remember, stressed-out gift buyers are your friends. Make their lives more accessible, and they'll love you for it. So, set up a "Father's Day Favourites" stand in your store and

• Put your good sellers on the stand from your POS System data
• Create staff picks based on sales data

Wrap It Up

Father's Day might be a short season, but it can significantly impact your bottom line. By using your POS system smartly and focusing on what shoppers want, you can turn this day into a real winner for your store.

This is one of the most used KPIs is labour cost with our restaurant clients yet it can be used for any modern business. In my years of experience working with point-of-sale systems, I've seen many retail shops firsthand how proper labour cost management can make or break a small business. 

Labour costs

The labour costs encompass all expenses related to your employees. This includes:

• Wages and salaries
• Overtime pay
• Superannuation contributions
• Payroll taxes if applicable
• Employee benefits 
• Paid time off (holidays and sick leave)

You probably have this figure in our profit and loss accountant, which the accountant prepared for you for the ATO. So, these calculations should only take you a few minutes to complete.

Revenue-based Labour Cost KPI

The labour cost ratio is a critical metric that measures the proportion of your revenue spent on labour expenses. It's calculated using this formula:

Labour Cost Ratio = (Total labour cost / Total revenue) x 100

If your shop's total labour costs for the year were $100,000. If your revenue is $500,000, then your labour cost ratio would be:

($100,000 yearly labour costs/ $500,000 yearly revenue) x 100 = 20%

So here it means you're spending 20% of your yearly revenue on labour costs.

Time-Based Labour Hour KPI

Although not part of the typical Labour Cost KPI, I suggest calculating it by week.

Labour cost a week = (Total labour cost / Number of weeks) 

If, for example, using the above, we say it is open 52 weeks a year

Labour cost a week = ($100,000 yearly labour costs/ 52 weeks )  = $1923 a week we need for labour costs in a typical week.

Why the Labour Cost Ratio Matters

Understanding your labour cost ratio is crucial because it:

1. It helps you evaluate how efficiently you're using your staff
2. Shows the impact of labour costs on your overall profitability
3. Allows you to compare your performance with industry benchmarks

Industry Benchmarks

In the retail industry, labour cost ratios typically range from 15% to 20%. However, because all shops are unique, they have different benchmarks. It's essential to research specific benchmarks for a shop similar to yours in your area. Many labour costs by industry are listed here, unfortunately not all, so what people often do is look for some industries that are close to theirs and see what those industries offer.

Tips to Optimise Labour Costs

Based on my experience working with various retailers, here are some effective strategies to manage your labour costs:

Use a Modern POS System

Your point of sale system has plenty of items that can do tasks that use labour, e.g. AI stock ordering management features. Use it to monitor your labour costs:

• It can also do rostering, allowing you to track your employee hours accurately
• Generate reports labour
• Allow you to forecast your staffing needs based on historical sales data
• Identify peak hours and adjust staffing accordingly
• Reduce overstaffing during slow periods

Employee Management

For example teaching your staff multiple skills, you can reduce the need for specialised roles to create a more flexible workforce. If you can reduce the need for someone extra to come to do a task, well that is a saving.

Monitor and Adjust Regularly

Keep a close eye on your labour cost ratio and adjust as needed. If it's creeping up, look for ways to increase efficiency or reduce costs.

Conclusion

Are you ready to take control of your labour costs? Start by calculating your current labour cost ratio and see where you stand. With the right strategies and tools, you can master labour costs and set your shop up for long-term success.

Economic Order Quantity(EOQ): A Deep Dive into the Science of Inventory Management

Over many years, I've seen firsthand how crucial effective inventory management can be. One tool that started the science of modern inventory management is the Economic Order Quantity (EOQ) formula. Since I received an enquiry about it last week, I thought I would explore the concept and show how it can benefit retailers.

The Origins of EOQ

A bit of history: in 1913, a mathematician named Ford W. Harris was pondering a theoretical shop stock control. He wasn't thinking about colourful products or bustling aisles. Instead, Harris was fixated on a more fundamental question: How often should a shop order its stock to keep costs down and do inventory optimization?

He derived his formula called EOQ, and modern inventory management was born.

Breaking Down the EOQ Formula

The formula he derived is this:

EOQ = Sqr(2 x D x K / h)

Where:

• D = is how much you sell in a period.
• K = Cost per order
• h = Holding cost per unit (how much it costs you to have the stock sit in your shop for a period)

Generally, it's over a year, so let's break this down with a real-world example and see what it can tell us.

A Real-World Example: The Stationery Shop

So I took a stationery shop that uses our POS System. Here's how we would use the EOQ formula to find how many times we should order to give us the best profit.

Annual Demand (D)

It sold 60,575 items last year in the shop. That's a lot of pens and paper!

Cost per Order (K)

I asked the woman who was in charge of the stationery order, and she told me that each order there was about

• 3 hours to place an order @ $25/hour
• 4 hours to pick up the order @ $25/hour
• $10 for petrol
• $20 for delivery fees

Total: $205 per order

Annual Holding Cost per Unit (h)

This is where things got eye-opening. We included:

• Bank fees and overdraft: 2.5%
• Shrinkage (a polite way of saying 'theft'): 1.5%
• Portion of rent: $15,000 a year
• Other costs from profit and loss: $10,000

When we crunched the numbers, it came to $1.08 per item per year. That's a lot if you think about it.

Let us do the calculation.

Now we have the figures, let us calculate the following:

EOQ = √[(2 x 60,575 x 205) / 1.08]

Let's break down the calculation step by step:

1. First, multiply 2 x 60,575 x 205 = 24,835,750
2. Then, divide this by 1.08: 24,835,750 / 1.08 = 23,014,583.33
3. Finally, take the square root: √23,014,583.33 = 4,797.35

Rounding to the nearest whole number, we get 4,797. That is a lot of ordering. 

Interpreting the Results

When we plugged all this into our EOQ formula, it suggested ordering 4,779 times a year. That's many times every day!

I don't know about you, but I've never met a retailer who wants to place orders daily. It's just not practical.

Practical Tips from EOQ

While the EOQ formula does not here give you a perfect ordering schedule, it does highlight some crucial points:

1. Holding stock is expensive: $1.08 per item per year adds up quickly. Our total inventory of 60,575 items is $65,421 annually, just in holding costs!

2. Frequent, smaller orders can be cost-effective. This approach aligns with many successful retailers' formula of order to do its' "little and often" philosophy. 

3. One size doesn't fit all: What works for our stationery shop might not work for a pet shop or a newsagency. 

How do you derive your figures using POS Solutions?

Calculating a simple EOQ requires three variables, which I will discuss point by point, quoting two departments as an example for you to work with as an example of stationery that I used above.

The demand quantity (D)

This is the quantity of goods moved.

There are two ways of doing this: the top sales report will give you this figure.

Cost of ordering (K)

I just asked about the procedure used in the shop and then costed it.

Holding costs (h)

Your profit and loss will help you here. If you are doing it by department, take a reasonable percentage of the total costs. 

I got the average stock holding to calculate my holding costs. So I went to the stock turn report in the stock reports. 

The Bottom Line

Executive summary

Here are some practical tips:

1. Calculate your holding costs: You might be surprised at what you find. Include all inventory costs, such as warehouse space, insurance, and potential depreciation. Your profit and loss will tell you most of this.

2. Review your ordering process: Write a typical order scenario in your shop. While doing so, I suggest you streamline this process to reduce costs. Maybe bulk ordering certain items could lead to discounts that offset increased holding costs. 

3. Consider a mix of strategies: Perhaps you should place frequent orders for fast-moving items and less frequent orders for others. Use EOQ as a starting point, but adjust based on your business's unique needs.

4. Use technology to your advantage: Our POS system can help you track inventory and make smarter ordering decisions frequently and accurately.

EOQ does not offer a flawless ordering plan. It indeed confirms certain crucial aspects of inventory management. 

Over the years in retail, I've seen that the most prosperous retailers use data and their gut feelings. So, while you should crunch the numbers, don't discount the value of your gut feelings.

Frequently Asked Questions (FAQ)

What is Economic Order Quantity (EOQ)?

Economic Order Quantity is an analytics formula for determining the optimal number of times to order stock to maximize profit.

How is EOQ calculated?

The EOQ formula is: EOQ = √[(2 x D x S) / H], where D is annual demand, S is setup cost per order, and H is holding cost per unit per year.

What are the benefits of using EOQ?

EOQ is a theoretical construction that helps balance ordering and holding costs, minimise total inventory costs, and optimize stock levels.

Can EOQ be used with seasonal products?

Probably not. EOQ becomes less effective if, over some time, you have fluctuating demand.

What's the difference between EOQ and reorder point?

EOQ determines the best number of times to order, while the reorder point is an inventory management system that concerns inventory levels. The EOQ may help you to derive this reorder point.

How can I implement EOQ in my business?

Your profit and loss statement and your POS System will give you the information you need to calculate your shop's EOQ. If you do so, please let me know what you get.
 

Here is how you can calculate your stock shrinkage in just a few minutes. You do have the information now.

The Importance of Calculating Stock Shrinkage

Regular stock shrinkage calculations are essential for the following:

1. Identifying inventory loss trends
2. Implementing effective inventory control techniques
3. Optimising your retail operations
4. Improving your overall profit margins

How to Calculate Stock Shrinkage

Follow these steps.

Using the figures for the 2023/24 year:

1. Determine your recorded inventory value: According to your records, this is the total value of stock. Your accountant should know this now.

2. Conduct a physical inventory count: You should know this from your stocktake.

3. Calculate the shrinkage rate:

   The Shrinkage Rate formula = (Recorded Inventory Value - Actual Inventory Value) / Recorded Inventory Value x 100

    

For example, if your recorded inventory value is $100,000 and your actual inventory value is $97,000, you have lost $3,000 of stock.

However, as stock shrinkage is commonly expressed in percentages, let's calculate this figure.

Shrinkage Rate = ($100,000 - $97,000) / $100,000 x 100 = 3%

Common Causes of Inventory Shrinkage

Understanding the reasons behind shrinkage is crucial for implementing effective inventory loss prevention strategies. These are the common reasons:

1. Shoplifting
2. Employee theft
3. Administrative errors
4. Supplier fraud
5. Damage or spoilage

   When I did it for a client, I used departments, and we came up with this chart, which looks about right.

   

The Role of Technology in Small Business Inventory Tracking

Investing in the right technology can significantly improve your inventory management:

1. POS systems: Offer real-time inventory tracking and sales data.
2. Camera: This is one of the few items that courts do accept.
3. Security system: You do not need everything, just a sample, to significantly affect shoplifting.

Conclusion

Mastering stock shrinkage calculation and implementing effective inventory reduction strategies are crucial for optimising retail profit. By utilizing the right tools, such as a robust POS system for businesses and implementing vital inventory control techniques, you can minimize losses and maximize profitability in your brick-and-mortar store.

Did you know that boosting your stock turn rate by just 20% could dramatically increase your profits? 

What Are Stock Turns?

Stock turns, or Inventory Turnover, measure how often you replace your inventory over a given period. It is a crucial indicator of your shop's performance.

The Basic Formula:

Manually, it is calculated by

Stock Turn = (Cost of Goods Sold) / (Average Inventory Cost)

Step-by-Step Guide to Calculate Stock Turns Manually

Calculate your Cost of Goods Sold (COGS) for the period.

Determine your Average Inventory Cost
Add your beginning and ending inventory values
Divide by 2

Divide COGS by the Average Inventory Cost

For example:

COGS for the year: $100,000
Start of the year inventory: $25,000
End of financial year inventory: $15,000
Average Inventory: ($25,000 + $15,000) / 2 = $20,000
Stock Turn = $100,000 / $20,000 = 5

The Impact of Stock Turns on Profitability

Cash Flow Management: Higher turns mean you're not investing in the slow-moving stock. This improved cash flow allows you to reinvest in your business.

New stock: Moving your inventory faster keeps your stock current, reducing the risk of obsolescence.

Space Efficiency: You can use your valuable retail space better by keeping fast-moving items on hand.

The Magic Number: 12

Many retailers aim for a stock turn of 12. Why? It's simple:

You're likely paying suppliers monthly
A turn of 12 means you're selling out monthly
This means you do not pay for the stock you sell.

How to Check Your Stock Turns with POS Software

Our POS software has made inventory analysis more manageable than ever. Here's how to check your stock turns:

Open your POS software
Navigate to Main Menu > Cash Register > Register Reports
Expand the 'Stock' section
Select "Show Stock Turn by Dissection and Item"

​Here is the sample I produced showing the stock turns by department.

As a general rule, the higher the score of your stock, the better. This, however, is not always true; a stock turn that is too high often shows that you are understocked. For example, you have an item you could sell once daily, but you order one weekly. So every week, you have sold one, so at the end of the year, you have a score of 50, which is a great score, but you have lost 250 sales that you could have had because you could have sold one a day and all you have sold is one a week.  

High Turns (8+): Great! But are you missing sales due to running out of stock? 

Mid-Range (4-7): Good, but room for improvement.

Low Turns (1-3): Time to reassess. Are prices too high? Quality issues?

Common Pitfalls to Avoid When Optimizing Stock Turns

Over-optimizing: Pushing for extremely high turns can lead to being out of stock.
Ignoring seasonality: Some products naturally have different turn rates at various times of the year.
Neglecting customer service: Don't sacrifice having enough stock to meet customer needs to improve your turns.
Forgetting about lead times: Consider how long it takes to restock when planning your inventory levels.

Our POS systems offer a range of features to help with inventory optimization:

Real-time tracking: Get up-to-the-minute data on your stock levels and turns.
Automated reordering: Set up automatic purchase orders when stock hits a certain level.
Predictive analytics: Use AI-powered (FOCUS) forecasting to predict future stock needs. Our software includes this feature for free.

FAQ: Common Questions About Stock Turns

Q: What's a reasonable stock turn rate? 
A: It varies by industry, but generally, a turn rate of 4-6 is considered good, while 6-12 is excellent.

Q: How often should I calculate my stock turns? 
A: Monthly calculations are ideal for most businesses.

Q: Can stock turns be too high? 
A: High turns may indicate that you're losing sales due to running out of stock.

Q: Should I use the same stock turn goal for all products? 
A: No, different product categories may have different optimal turn rates. Use our POS data to set appropriate goals for each category.

Wrapping Up

Take time to analyse what these scores are telling you. This will help you to identify the actions required to improve profitability and return on investment.

Now, you need to analyse your stock and check each department to see what is working and what is not. A score signals bad sales and that you are more stock than you realistically need at any given time. Maybe you have a pricing or quality issue, but that department has a lot of obsolete stock. If so, move the obsolete stock to a different department, as it will not give you fair figures here.

A high score indicates greater profitability and a good return on investment, although, as I stated, it may also mean that you are not ordering enough.

Remember, every figure has a story.

Imagine if, in a few minutes, instead of guessing how last year's sales went, you knew this. Sounds like magic, right? Well, that's the power of your modern POS software at your fingertips!

Why Analyse Your Sales?

In the bustling world of retail, staying on top of your sales performance isn't just bright—it's essential.  Knowledge is power. Understanding your sales trends through retail data insights allows you to make smarter decisions and drive your business forward.

Point of sale reporting

Before we dive into the nitty-gritty, let's quickly spotlight why your POS software is the unsung hero of your shop:

1. Real-time tracking: You need to know what is selling now!
2. Inventory management: Never run out of your bestsellers again.
3. Customer insights: Understand what the customers in your shop want.
4. Data-driven decisions: Make decisions based on data.

The Dissection Comparison Report: Your Retail Crystal Ball

Our point-of-sale software offers a powerful tool called the Dissection Comparison Report. This intelligent feature allows you to compare your sales performance across different periods. It's like having a time machine for your business!

How to Access Your Sales Comparison Report

Follow these simple steps to unlock your retail data insights:

1. Go to the Main Menu
2. Click on Cash Register
3. Select Register Reports
4. Under the Select Report tab, expand the Stock folder
5. Choose "Dissection Family Class Period Sales Comparison"

Comparing Year-on-Year Performance: Your Business Time Machine

Let's dive into how you can use this report to assess your annual performance:

Then you will see this screen. This is what you will get.

1. Set the left side dates:

   • From: 01/07/2022
   • To: 30/06/2023

2. Set the other side dates:

   • From: 01/07/2023
   • To: 30/06/2024

This comparison will show how your business has grown over the past year. It's like searching past photos of your business.

What to Look For in Your Retail Sales Analysis

• Overall sales growth: Has your total revenue increased?
• Top-performing categories: Which product families are your stars?
• Underperforming areas: Where might you need to make changes?
• Seasonal trends: Do certain products shine at specific times of the year?

Zooming in on Quarterly Performance: The Recent Snapshot

To get a more recent snapshot of your business, let's look at the last quarter:

1. Set the left side dates:

   • From: 01/04/2023
   • To: 30/06/2023

2. Set the other side dates:

   • From: 01/04/2024
   • To: 30/06/2024

This comparison is used to spot recent trends. It's like having a magnifying glass for your most recent business performance!

Questions to Ask Yourself for Better Business Insights

• What products or categories have seen considerable growth?
• Are there any surprising declines in sales?
• How do these quarterly results compare to your annual trends?
• Is your inventory management aligned with your sales patterns?

Data-driven retail management

Now that you have the information, here are some tips to turn your retail data into action:

1. Celebrate wins: Did a particular product category smash it out of the park? Give yourself a pat on the back, and consider expanding that line!

2. Investigate dips: If sales dropped in an area, ask yourself why. Was it a change in customer behaviour or perhaps a supply issue? Your POS software can help you dig deeper.

3. Spot opportunities: Are there growing categories you could expand? Use your data to guide new product decisions.

4. Plan: Use these insights to guide your inventory management and marketing efforts. Stock up on what's trending before your competitors do!

5. Customer focus: Look for patterns in what your regulars are buying. Can you create bundles or promotions based on these insights?

6. Staff training: Share these insights with your team. Knowing what's selling can help them provide better customer service.

Business growth strategies

These reports are your numbers – they are your story. Regularly checking your sales performance gives you the knowledge to make intelligent decisions.

Your Action Plan:

1. Log into your POS software today
2. Run your first Dissection Comparison Report
3. Identify one area of improvement and one area of success
4. Make a plan to address the improvement area
5. Share your success with your team to boost morale

Ready to Supercharge Your Retail Success?

Don't let valuable insights slip through your fingers! Your POS software is ready to reveal the secrets of your shop's performance. Why not dive into your Dissection Comparison Report today? You might just uncover the key to your next big business breakthrough!

Bad pricing can be a death sentence in retail. It would be best to have the right pricing strategy to operate in this ultra-competitive landscape. Here is the game-changing solution to help you achieve that.

The Pricing Predicament: Challenges Galore

• Customers question your prices, leaving you scrambling for justifications.
• Suppliers are inquiring about your price, and you're unsure how to respond transparently.
• Endless hours spent analyzing historical pricing data to determine what works for you.

We've developed a cutting-edge solution that puts you back in control of your pricing strategy.

Introducing the Game-Changing Pricing Tool

Our innovative Point of Sale (POS) software boasts a revolutionary "Price Change" feature that revolutionizes pricing management. With just a click, you gain access to:

• A comprehensive pricing history for every product
• Effortless cost and retail price comparison (displayed in red and blue)
• Historical data to inform your pricing strategy

This will set you apart from the competition.

How to use this price-changing tool

You will find a Price Change screen in green above in the stock item. 

Now when you click that, you get another screen with the cost price shown in red and see the blue arrow, you have your retail price. 

Now, you have a complete history of the costs and retail prices and can sort by date. This can help you determine your retail pricing strategy and the right product price.

With just this click, you gain access to:

• A comprehensive pricing history for every product
• Effortless cost and retail price comparison (displayed in red and blue)
• Historical data to inform your pricing strategy

In my experience, the process is quick to do. Also, what I find very useful is assessing the price vs. sales. There is no point selling too cheap if you can get more.

Elevate Your Retail Success to New Heights

Don't let pricing hold your business back any longer. Take control of your pricing strategy today and unlock a new level of retail success. Your business's future is in your hands.

This is the sort of report managers in major retail shops look at weekly. Now, understanding foot traffic is excellent for retailers. Knowing how many people enter your shop can give you a lot of information. This is commonly called your footfall. Let's dive into it and see how it can benefit your business.

Why People Counting Matters

People counting technology provides valuable insights that can help retailers. The primary use is to determine the correlation between foot traffic and sales. Let's explore four results.

High Foot Traffic, Low Sales

• Analysis: Many people are entering your store, but sales are not happening for this traffic.

• Possible reasons:

  • Your stock is not what the people drawn to your shop are looking

  • Often, this is caused by not having enough staff.

  • Unengaging store layout or customer experience.

• Actionable insights: Review product placement, marketing strategies, and store layout to identify areas for improvement.

Low Foot Traffic, High Sales

• Analysis: Fewer people enter your store, but sales are higher than expected.

• Possible reasons:

  • Targeted marketing campaigns are attracting the right people.

  • Effective product placement and inventory management.

  • Engaging store layout and customer experience.

• Actionable insights: Continue refining marketing strategies and focusing on customer experience and product placement. Consider how to get more of these people.

High Foot Traffic, High Sales

• Analysis: Many people are entering your store, and sales are strong.

• Possible reasons:

  • Effective marketing campaigns and promotions.

  • Engaging store layout and customer experience.

  • Good product placement and inventory management.

• Actionable insights: Well, clearly, you are doing the right thing.

Low Foot Traffic, Low Sales

• Analysis: Fewer people enter your store, and sales are lower than expected.

• Possible reasons:

  • It would be best if you considered how to get more people into the shop

  • Poor product placement or inventory management.

  • Unengaging store layout or customer experience.

• Actionable insights: Review marketing strategies, product placement, and store layout to identify areas for improvement and develop targeted campaigns to attract more customers.

It also gives other information. 

Understand Foot Traffic Patterns:

• Analyse the number of people entering your store to identify peak hours, busy periods, and slow days.

Optimise Staffing and Inventory:

• Use foot traffic data to adjust staffing levels, manage inventory, and restock shelves during peak periods.

Account for External Factors:

• Understand how weather, sporting events, and other external factors impact foot traffic.

Types of People Counting Technologies

There are two main types of technology used by my clients

Beam Sensors

Beam sensors are the earliest, cheapest, and simplest people traffic counters. They consist of an infrared emitter and detector positioned on either side of a doorway. When a person walks in or out, the beam breaks, and the counter registers a count.

Pros:

• Simple and Cost-Effective: Break beam sensors are cheap and easy to install.

Cons:

• Unidirectional: They can't distinguish between people entering and exiting.
• Barrier Perception: The beam can act as a barrier, making some customers reluctant to enter.
• Accuracy Issues: They may count two people walking together as one, making the results questionable in a full shop. Also, they tend to miscount families and people with prams.

WiFi Counters

These use the WiFi signals from smartphones to detect and count people. This technology is said to be more accurate as almost everyone carries a smartphone.

Pros:

• Accurate and Advanced: Most people have smartphones, providing reliable counts.
• Hidden: No one knows that you have them. This has proven to be a huge plus.
• Advanced Capabilities: Potential to identify repeat visitors or known shoplifters and exclude staff from counts. For privacy reasons, few do this, though.

Cons:

• Higher Cost: WiFi counters are more expensive.
• Bluetooth Dependency: Individuals may not be counted if Bluetooth is turned off. This is a big problem. 
• Overcounting: Many people today have smartwatches. These can be counted twice.

Overall, I think Beam is better, but many would disagree. 

Integration: Manual vs. Automated

When it comes to integrating people counting technology with your POS system, there are two main approaches:

Manual Integration: Most small retailers opt for manual integration. Each morning, they check the people counter, record the number, reset it, and then enter the data into a spreadsheet. While this method is cost-effective, it has a significant downside: It's messy, time-consuming, and does not give hourly traffic data.

Automated Integration: Although more expensive, investing in an integrated solution provides continuous, real-time data. This allows for detailed foot traffic analysis by the hour, offering deeper insights for better decision-making. I think the extra cost is worth it. 

Conclusion

People counting technology is a powerful tool for small retailers. It provides invaluable data to enhance staffing, inventory management, marketing strategies, and overall store performance. 

If you consider this technology to unlock the power of people counting technology for your business, worth investigating, please get in touch with us to learn how people like yourself use it to help their retail businesses. 

This is risky, and be cautious. Price rises are signals to people to drop you.

People leap after they see a fee rise. However, the fact is that during the business, there can also come a time when you want to elevate your fees. A price increase is often required to maintain profitability and your operations, whether due to inflation, multiplied provider costs, or a strategic shift for your commercial enterprise version. Here are a few ideas that will help you do it.

Understand the Reasons for a Price Increase

Before diving into the method, it's essential to understand the different factors that may necessitate a price adjustment. Here are a few common motives why groups choose a charge increase:

Rising Costs: If your providers have raised their costs or are facing extended operational charges, such as rent or utilities, price growth can be necessary to maintain your earnings margins.

Inflation: As the price of goods and services rises due to inflation, you could want to alter your costs to keep up with the changing economic climate.

Product Enhancements: Perhaps you're transferring your commercial enterprise closer to a more premium market section. A consumer decided to drop many cheap motorcycles and focus on more expensive bikes. With this technique, he lost all his clients.

Conduct Market Research

Before imposing a price rise alternate, it is vital to apprehend your competitive landscape and client perceptions. Consider the subsequent study steps:

Analyse Competitor Pricing:

Examine the prices of similar services or products your competitors provide. This will help you gauge the marketplace fee and ensure your new costs remain competitive.

Survey Your Customers: 

Gather feedback from your customers. This will offer insights into their willingness to pay more for your offerings and assist you in expecting capacity reactions to a growth rate.

Review Historical Data: 

Analyze your sales statistics and purchaser behaviour from preceding fee adjustments. This can help you identify patterns and predict the ability impact of the approaching rate exchange. In your POS System call up the product and see the effect of price increase on these prodycts.

Prepare a Plan B:

Consider what to do if your clients reject the new rate upward push too strongly. 

Develop a Pricing Strategy

Once you have accumulated the critical information, expanding a properly-idea-out pricing approach is time. Consider the subsequent methods:

Gradual Increase:

Instead of enforcing an extensive charge hike, you could choose a more minor, incremental increase over time. This technique may be much less jarring in your customers and extra handy for them to adapt. It works nicely if only a few items pass up at a time.

Bundle Offerings:

Remember to bundle complementary products or services at a reduced fee rather than increasing the rate of personal objects. This approach can lower your clients' perceived price while growing overall sales.

Communicate

 There are two views here. 

Option 1: Provide notice

This allows your clients to regulate their budgets and expectations. It also demonstrates transparency and builds acceptance as true among your consumer base. Explaining the reason behind the charge boom is allowed, but it gives your clients time to consider alternatives. In my experience, most customers do not pay much interest until it happens.

One massive plus is that it can set off a few customers to buy before the rate increases, quickly impacting your revenue. This is why so many humans do it.

Option 2: Provide no warning

This permits you to implement the trade swiftly without a prolonged notification period, but it risks unexpected or alienating customers who feel blindsided during the exchange. If not treated cautiously, it could damage purchaser trust and loyalty. It also leaves less time for customers to alter their budgets or expectations.

Whatever approach you take, it's important to explain the motives behind the charge boom simply and transparently. Highlight the cost and blessings your products or services offer your clients, and remember to offer loyalty rewards or reductions to your current customer base as a gesture of appreciation for their patronage.

Monitor and Adapt

After enforcing the price change, closely monitoring the impact on your income and consumer pride is critical. Be prepared to make modifications if necessary:

Analyze Sales Data:

Track and compare your sales figures to pre-growth ranges. You can also reevaluate your pricing method if you note a sizable decline.

Gather Customer Feedback:

Encourage your clients to provide remarks at the price trade through surveys, social media, or in-man or woman conversations. This treasured input will let you perceive regions for development and make essential adjustments.

Remain Flexible:

If your initial pricing approach is not yielding the preferred results, be open to adjusting it. Based on the information you have gathered and client remarks, adapt and refine your technique.

Implementing an increase can be delicate, but you can navigate this transition efficiently with cautious planning, effective communication, and a patron-centric technique. Remember, a nicely completed charge growth can enhance your profitability and strengthen the perceived price of your services in your clients' minds.

Ever feel like your profit margins are a bit of a mystery? You know the numbers your suppliers give you, but those rarely show what is happening in your shop. That's where actual gross margin comes in – a true reflection of your operating efficiency.

For example, here at POS Solutions, we realize that running a successful store in the brick-and-mortar world requires knowledge. Therefore, our point-of-sale software makes monitoring your gross margins incredibly easy, giving you valuable insights to make informed decisions that can boost your bottom line.

Why Actual Gross Margins Matter More

While suppliers often provide "quoted" gross margins, these figures might not tell the whole story. Here's why:

• Markup vs. Margin Confusion: Suppliers might quote a markup percentage (e.g., a 42% figure), which sounds more impressive than a gross margin of 30%. Plus, getting an actual feel of your business profitability will be tough if some items you have are markup and some are gross margin.
• Selective Sharing: Sometimes, suppliers provide margins only for most products and then claim the rest they ignore. Yet even the rest of the items can impact your overall profitability.
• Discounts and Deals: Let's face it, discounts and promotions are a part of retail life. But these can significantly impact your actual gross margin compared to the quoted figure.

Get Instant Insights with POS Solutions Sofware.

Imagine having a real-time snapshot of your actual gross margins at your fingertips. With our user-friendly POS software, that's precisely what you get! Here's how it works:

1. Access Your Cash Register Reports: Head over to your POS software's cash register reports section.
2. Navigate to Sales: Locate the sales reports within the cash register reports section.
3. Unlock the Power of Dissection: Look for a report titled "Dissection Sales / Profitability for a Given Period." 
4. Run the Report: Select the desired timeframe (e.g., the last year) and generate the report.
5. Find Your Profit Percentage: Within the report, you'll see a magic column – % Profit. This displays your actual gross margin, broken down by product or category.

See the Difference for Yourself!

It's that simple! Monitoring your gross margin with the POS Software System takes seconds. Stop relying on guesswork and hidden figures—take control of your profitability today!

Want real-time insights? Contact us today to learn more. We can show you how our POS software can give you the information you require to help you run your business.

How to Avoid Losing Customers

It is frustrating when a customer comes in looking in your shop only to find you're out of stock. We all now how we feel when this happens. What is your customer now thinking, maybe of going to your competitor? 

The good news is this common issue can be largely avoided with our POS system. 

So here is how you can use the inventory features in our POS to avoid out-of-stock and keep customers coming back.

What is "Out of Stock"?

Out of stock means a product is unavailable for purchase because you don't have any left in your store. It is said here to account for about 8.3% of all shopping trips. It's a lot.

What we have now is a missed sale and a disappointed customer.

This is extremely common when

- An obscure holiday is occurring that some of your customers follow and you have forgotten to buy stock for them

-If have run out of stock and not realised it.

Use the "Sold Out or Selling Out Stock Lines" Report

Our POS system has an extremely handy report called "Sold Out or Selling Out Stock Lines".

It will take you seconds to run and save you thousands.

Here's how to use it:

1. Go to Reports > Stock
2. Select "Sold Out or Selling Out Stock Lines"

What you want is to pick a period last year of the same date as now to compare.

These products need to be checked ASAP. This can help you make sure you have adequate stock.

Moreover

It also alerts you whether items are not properly entered into your system as the stock-on-hand figure is negative, as shown in the example below.

I recommend running this report weekly to stay on top of stock levels.

The Risks of Out-of-Stock

Why go to such trouble to avoid out-of-stock issues? Well, the fact is that your customers will tolerate this situation only a few times before taking their business elsewhere.

Well, most of your regular customers tend to follow a "three strikes, and you're out" pattern:

• Strike 1: The first time a product is out of stock, the customer substitutes 70% of the time, and 30% go elsewhere.
• Strike 2: The second time, they may substitute, not buy anything, or go to another store.
• Strike 3: The third time, they switch stores 70% of the time—losing you their business.

Today, customers have little patience for out-of-stock. They will quickly take their business to retailers that reliably stock what they want.

So stay on top of your inventory with our POS system! Run stock reports weekly, keep high-demand products well-stocked, and avoid frustrating your customers. 

Running a successful retail business means ensuring every product on your shelves earns its keep. This is not easy. You know the items are ringing up the most sales. What is more challenging is to see if the slow sellers are boosting revenue by selling other products. This is where your point of sale software's Stock Companion Report can help.

Measure An Item's True Value

Go to Cash Register Reports > Sales Register > Stock Companion Sales by Period. See the green arrow below.

Select the stock item, put in the last 12 months, and you will get a detailed report listing profit, numbers, etc. 

You'll get a detailed report showing the item's profit, sales numbers, and more. With this data, you can evaluate whether a slower-selling product with low direct sales attracts customers who purchase other higher-margin items.

Insights for Smarter Merchandising

One client used the Stock Companion Report for dry cleaning. This service had low profitability, so they debated whether to keep it, but they found it brought in good customers who bought other products. So they kept offering it.

The Stock Companion Report is just one example of how our POS software arms you with the insights you need to optimize your product mix. Slower-selling items may be necessary to attract foot traffic and complementary sales. Understanding these hidden contributions lets you make informed merchandising decisions that maximise your total store revenue.

Let our POS system provide the robust reporting you need to understand what's driving your sales. 

This is just another example of how our POS System provides you with stuff you can use. Call us to learn more.

As a retail business owner now, it will be many months before you know how your business travelled in 2023. Here is a quick method to check and compare your yearly sales figures.

Year-over-year comparison

First, pull total sales reports for the past few years. For example:

Go to register reports.

Now select the item marked "Sales Comparison for a Given period".

Note you can do it by a supplier, but that can be done later when you have more time for detailed analysis. What we are doing here is getting a quick idea.

1) Put in here the dates 

01/01/2022 to 31/12/2022 AND 01/01/2023 to 31/12/2023

This will take you a few seconds. Then you will get detailed information showing how you went in 2022 compared to 2023.

Write down some key figures. on the report that you wish to measure.

2) Now go back in and run the report with 

01/01/2020 to 31/12/2020 AND 01/01/2021 to 31/12/2021 

You now have four years of information to study. This should give you a pretty good idea of how your business travels now. I find drawing a graph of sales shows me a clear picture. I hope these figures went well for you.

Sales trends

Say, for example, I have figures like this 

• 2020 total sales: $450,000
• 2021 total sales: $485,000
• 2022 total sales: $510,000
• 2023 total sales: $560,000

Compare the totals to identify upward or downward sales trends over time. Steady yearly growth suggests your efforts are working.

Evaluate Suppliers Sales

Use the same method except this time to break down sales by your suppliers month-by-month.

See how the supplier is doing for you.

Compare Operational Factors

Now, some questions to ask yourself.

• Did you expand hours, staffing, space or inventory?
• Did you run more promotions or advertising campaigns?
• Did you add or remove product lines or services?

Data-driven decisions

Use this to make data-driven decisions for your business to move forward. See what is working, what’s not, and where your retail business needs to head next. Let data guide your strategy. Turning those sales insights into concrete actions to improve your future performance is vital. Let the data direct you toward new opportunities for sales, traffic, and profit growth in 2024!