Negative inventory is when the inventory level of a stock item in your system shows less than zero. What it shows is that your records are inaccurate. The computer tells you you have sold more of this item than you had in stock.

This can, if not addressed, seriously harm your retail business in a few key ways:

> Reduces faith by you and your staff in your inventory management system. At best, you will waste time second-guessing inventory counts. At worst, it is an advertisement to your staff that you do not know your stock figures.

> It distorts your reports system-wide. These negative stock figures often get included in your information.

> It means you have no stock control on many items.

Common Causes of Negative Inventory

Negative inventory typically arises from these problems:

> Inaccurate manual counts at stocktaking, there is a lot to count, and errors do happen.

> Data entry mistakes by your suppliers coming through their electronic invoices or by people in your shop inputting stock quantities.

> Failing to enter invoices before selling makes problems.

So it is best to correct any negative inventory situations. Here are some best practices for controlling negative inventory:

Finding the negative stock

Fortunately, we have a quick and easy way to check stock quantities for what you have on hand.
 
Go to reports. There is an option for Quantity On Hand and Price check; click on that.

We exclude those items that have zero stocks. 
 
I suggest doing it by department so in this example, I picked the dissection (department) tobacco. 
 

Now outcomes a report listing the details of your item, looking at the quantities on hand in the column QOH, you may see items in brackets, see green arrow below, these are the negative Stock Discrepancies.

At first, you will find it a lot of work to fix it, but once done, it's relatively quick.

You should frequently check this report for negative stock values, say monthly.

Now audit these negative items to determine what went wrong in your inventory management system.

Conclusion

With proactive prevention and early detection, negative inventory can be handled. Leverage tools like our reports to stay on top of your stock quantities.

Let us know if you have any other questions!

For retail, inventory management is crucial; having too much inventory ties up cash while having too little risks stockouts and lost sales. One KPI gaining in popularity is Days Sales of Inventory (DSI). It is now often quoted for gauging inventory performance. Banks often use it today. I think readers here will find it helpful. 

From your accountant's figures which you are getting, it is easy to determine. So now is the time to look into it.

What is DSI?

DSI measures how many days a company's current inventory stock will last. It is calculated by dividing the average inventory by the cost of goods sold per day. The formula is:

DSI = (Average Inventory) / (Cost of Goods Sold) x (365 days)

when (Average Inventory) = ((Opening stock value in last Financial year)+(Closing stock value in last Financial year))/2

and the (Cost of Goods sold) you will get from your accountant.

Generally, the lower the DSI, the more efficiently you turn over your inventory and convert it to sales.

The kicker is that about 45. Most suppliers give 30 days, so 45 means you do not pay for your stock.

Why DSI Matters

DSI directly impacts cash flow and liquidity. The faster inventory turns into sales and cash, the sooner money can be reinvested or used to pay expenses. Slow inventory turnover ties up working capital.

DSI also reveals operational efficiency. Well-managed inventory aligns with demand forecasts and optimises stock levels. Comparing DSI over time or against industry benchmarks shows room for improvement.

DSI Across Industries

DSI varies widely between sectors based on product categories and sales cycles:

• Grocery stores have a very low DSI, often less than ten days. Food products sell quickly with high turnover.

• Electronics and appliances may have a DSI of around 45 days.

Factors Impacting DSI

Several factors influence DSI:

• Sales Volume - Higher sales volume reduces DSI by turning over inventory faster. Declines in volume can lead to excess stock and higher DSI.

• Inventory Levels - Keeping inventory aligned with demand lowers DSI. Overstocking increases inventory days on hand.

• Pricing - Price reductions or discounts can temporarily boost sales volume and lower DSI.

• Supplier Terms - Delaying payments to suppliers raises short-term working capital but may increase long-term costs.

DSI vs. Other Inventory Metrics

While DSI measures days of inventory on hand, other key metrics include:

• Inventory Turnover Ratio (ITR) - Annual COGS divided by average inventory. Higher ratios indicate better efficiency.

• Cash Conversion Cycle (CCC) - Days inventory outstanding + days sales outstanding - days payables outstanding. Lower CCC improves liquidity.

I will discuss these in a future post if there is enough interest.

Best Practices for Inventory Management

To optimise inventory performance and DSI, leading practices include:

• As I have discussed many times, automating stock ordering using your focus AI system here.

• Better stock ordering

• Push high-volume stock items.

In Sum

Monitoring DSI helps gauge inventory turnover, sales efficiency, and cash flow. It provides actionable insights into stock levels.

Calculating shrinkage and damaged goods can help retailers understand their inventory management and make necessary improvements.

Obtaining Perpetual Stock Value

This is your theoretical stock value before you start the stocktake. This figure is stored in your POS Software in stock reports; if you prefer, use your best estimate.

Physically Counted Inventory Value

This is the stock value you actually had after doing the stocktake.

Sales of Stock Product

Use your total report to get this figure. You need to take out the non Stock item sales, e.g. lotto.

Calculating Shrinkage

The Shrinkage is calculated by finding the difference between (Perpetual Stock Value) and (Physically Counted Inventory Value). This is commonly expressing it as a percentage of Sales of Stock Products. Use the following formula:

Shrinkage% = ((Perpetual stock value) - (Physically Counted Inventory Value)) / (Sales of stock product) * 100

A typical shrinkage rate in 2020 was stated as about 1.4%, but it was found to range from 0.1% to 6%. Higher than-average shrinkage indicates inventory loss or waste. I suspect they figure today would be similar.

Calculating Damaged Goods

What I suggest you do is also calculate your Damaged Stock Value.

Your stock sheets should be able to give you these figures.

Percentage of Damaged Goods% =(Damaged stock value) / (Sales of stock product) * 100

High levels of damaged goods indicate issues with quality control or carelessness. A common reason is goods left too long in the sun in the window.

Conclusion

After determining the overall measurements of your inventory shrinkage and damaged goods, you might want to dive deeper into specific departments by performing this analysis across departments and also consider doing it by key items and locations. Using this, you can pinpoint areas of concern. With this knowledge, you can set achievable targets and monitor progress against industry benchmarks or personal goals, ultimately enhancing your overall inventory management performance.

Do you want to run your business in real time, no matter where you are? If so, you must access your financial reports anytime, anywhere, from any device. Only then can you track your performance. See what's selling now. This is powerful business insight. To do so, you need accurate and timely information about your business details, such as sales, expenses, inventory, and customers.

Some of the benefits of accessing your financial reports anywhere:

If this sounds good, then you need smart reporting. It automatically delivers simple or detailed reports to your inbox at regular intervals. You can choose the report details that suit your needs. You can also quickly and securely share your information with your team members, business partners, etc.

It can help you run your business in real-time to make better decisions faster.

- Save time. Save money. It is automatically done once set up. Your smart reports are sent automatically.
- Using digital reports, you can save trees by reducing printing and storage costs.
- Reduce errors and risks. You don't need to worry about human errors or data inconsistencies. Computers remember. You can rely on smart reports to provide accurate and reliable daily information. 
- You can also reduce the risk of data loss or theft by using a secure cloud storage system to transport and keep your reports.
- You get a clear and concise overview of your business performance daily. 
- You can also identify trends, patterns, and opportunities for improvement without even being in the shop.

Let us start!

Go into End of Day.

Now in the Options, you can see (red arrow) where you have plenty of options and pages to specify the report to your needs. So choose the type of information you need. You can choose from simple to detailed views.

Now see the brown arrow. Press that.

Now out will come out more reports option, don't worry about them yet. We can cover them in another post. Let's just get started now, and we can build later.

Click on the blue arrow. 

Set it up daily. Archive it in your email folders with a filter if you do not need it daily or what I do put it in a special folder. It is rare for someone looking at their data to complain that they have too much information.

Click on the green arrow. 

Please choose how you want it to come by email or SMS.

Conclusion

With your new automated business reporting system, you will now receive actionable reports directly to your inbox. You get the same level of data-driven insights previously only available to executives at large organisations. To improve your business, accessing your financial reports anywhere is a great place to start.

Introduction

Running ͏a shop requires you to keep track of how your business is doing. This can be challen͏ging if you sell products from different suppliers. Base͏d on my own experience, I have found that monitoring suppliers’ performance is ͏very useful.͏ You want ͏to know ͏which ones bring you more sales and profits and which are lagging behind.

One way to do this is to use the “Sales Comparison by Supplier” report in your POS System. This report will show you͏ the actual figures and the͏ changes over time for each supplier. By ͏analysing your suppliers, I ͏have gained valuable insights about my shop based ͏on various criteria such as the number of sales, total value of sales, avera͏ge sale amounts and ͏profit. For example, I have ͏determined which suppliers are unde͏rperforming or overper͏forming. I have also used ͏this re͏port to assess if my suppliers are giving me enough margins to meet my needs.͏

In this article, I will share with you how to use th͏e ͏“Sales Comparison by Supplier” report by walking you through the steps, interpreting it, and th͏en taking action based on͏ it.

How to Access the "Sales Comparison by Supplier" Report

To access the "Sales Comparison by Supplier" report, follow these steps:

It is in the register sales reports; find the report "Sales Comparison by supplier."

Click on it, and you will get this screen.

How to Customise the "Sales Comparison by Supplier" Report

To customise the "Sales Comparison by Supplier" report, follow these steps:

Select a period for the report, let us keep it simple so start with the past 12 months and compare it with the previous 12 months. So leave it AS IS, and run the report. Afterwards, feel free to explore more options as desired.

Screenshot of Customised Sales Comparison by Supplier Report

How to Interpret the "Sales Comparison by Supplier" Report

You have a report of your suppliers that shows you the summary statistics for each supplier. They are based on each criterion you selected and a comparison of how you have been travelling with them. The big ones and those with significant movements in the comparison percentages are fascinating.

Look at the profit figure. Today we are seeing significant downward margin creep. This is an excellent place to see it. The reasons for this downward margin causes appear to be many, and it seems to be both due to changes in customers and suppliers. I will discuss this in another article.

Now rerun this report and compare suppliers based on those that handle similar products. Now compare and contrast these different suppliers based on their performance over time, noting the number of sales and profit.

Conclusion

Now Take Action Based on the "Sales Comparison by Supplier" Report. I would contact underperforming suppliers and communicate to them your concerns. Then I would ask those suppliers that I am doing well with how you can do more with them.

The report is an actionable tip.

Please give it a go and see how it goes.

Easter is an extraordinary chance for retailers to build their sales, yet to make it work requires preparation. What is needed now is a review of what worked and what didn't.

In this context, we'll look at some techniques for evaluating this Easter sale in your store.

Sales Reports

An essential tool for monitoring your sales performance is your sales reports. You can learn more about your profits, top-selling products, and employee performance by reading these reports. This data can assist you with spotting patterns and making informed, information-driven choices.

Monitor your Sales Performance

Go to reports and click on sales.

Using this report, you can compare and contrast your store's performance in each department.

First, pick the dates for Easter and run compared to sales data from 2020, before COVID. Now run again for Easter and compare to last year.

Please pay close attention to the relevant departments by clicking on the left side of the report as you move through it.

Advantage of utilising sales reports rather than feeling

You can precisely assess your performance and identify your bestselling products by relying on sales reports rather than intuition. With this knowledge, you can foster a business methodology that expands benefits. When you look at sales data from specific days, you can see trends, areas where you did well, and opportunities for improvement.

Your shop can achieve its goals and make well-informed, data-driven decisions if you incorporate sales reports into your decision-making process.

Conclusion

Every year retailers have a one-of-a-kind chance to boost sales during Easter, but it requires careful preparation and planning to get the maximise benefit. If you want to improve your business strategy, it is essential to evaluate what worked and what didn't.

Introduction

Selling greeting cards are a profitable business opportunity for retailers as they have high sales and margins. 

Greeting cards are considered the department in the shop that can be the fastest and best improved by monitoring by POS Software. Improvements, when done, are often immediate.

The problem now is that most of the greeting card management today in most stores is done by the sales representatives of the card companies. These people are notorious for making decisions that maximise their companies, not the retailer. This is because, in the past, managing this department was extremely difficult using manual methods as there were too many greeting card lines, but it is easy with POS Software designed to do so. Today by utilising POS Software, you can rapidly and effectively see which cards are selling well and which do not.

Now, what you can do - the action plan!

Your POS Software is tracking the cards sold. Most of you have the data inside your computer now. You can use that to make informed decisions about your greeting card stand.

Review your top-selling report by quantity and the last 12 months. Set up an arbitrary minimum sales number.

Say you want to find now your slow-moving stock that you are holding. This is a quick step by step way of doing just that.

Go to reports and select stock, see the red arrow on the image here.

Now enter in the criteria you require.

Where it is brown is the date range, I suggest starting with a year, but it's also good with three months.

Where it is blue, enter the minimum sales figure from the top-selling report.

Where it is purple is where you specify the greeting card department.

You then get a detailed report showing the value of the stock holdings and the amount moved in this period. I think many of you may get shocked by its value.

Further analysis

> Now analyse your cards by category using your sales data. See which categories are selling well and which do not. This information will help you decide which categories to expand and which to contract.

> Review greeting card sales by their position on the stand to see where your cards are selling well. Your best-selling cards should be in the best places. What you are trying to do is place the cards to maximise sales.

> To identify seasonal patterns, retailers should also keep an eye on trends in sales over time by categories. These patterns can to used to maximise profitability.

> Now compare your greeting sales data to previous periods. You can see how your greeting card stand performs by comparing sales data to prior periods.

> Your sales reports can also help you identify your price points in the greeting card. Using it, you can quickly determine the prices for cards your customers are willing to pay.

Quantities on Hand

If your stock levels are incorrect, you must consider a stocktake to proceed.

Retailers should track inventory levels to avoid overstocking and increased storage costs. It is common in your storage area to find cards just sitting there.

Set up a monitoring schedule.

Set up a regular schedule to watch your card sales and stock information. It takes little time to do this once you are set up.

Conclusion

Using your POS software sales data analysis can be a more lucrative department.

Executive Summary:

> Greeting cards are a lucrative business opportunity for retailers due to their high margins and sales.
> POS software that monitors sales of greeting cards may result in immediate sales increases.
> Retailers frequently rely on management from card companies' sales representatives, who may not put the retailer's interests first.
>Greeting card sales can be effectively managed, and data-driven insights for decision-making can be provided by POS software.
>Top-selling cards can be reviewed, sales can be analyzed by category and location, seasonal patterns can be found, sales data can be compared to previous periods, and the best price points can be found using POS software.
>Additionally, retailers can avoid overstocking and storage costs by monitoring inventory levels and establishing a monitoring schedule.
>Retailers can increase their greeting card department's profitability by using sales data analysis in point-of-sale software.

Every inch of your store, including the front counter, should be utilised to its full potential as a retailer. Your greeting card sales can increase by being displayed there. So increase sales by having a small stand for greeting cards at the front counter. This makes it easy for people in your shop to add cards to their purchases.

Why have a greeting card stand for the front counter?

The front counter is a region that all clients visit while buying. It is the most profitable and marketable place in the shop. Customers often wait and look around to see what else you offer. A card is a great addon to buy with many goods. By doing this, you are making it simple for your customers to buy your greeting cards.

Which Cards Should Go in this Stand?

It is only a small stand. You may have many cards in another part of the shop, but most have not selected them so you are giving them a second chance to buy a card. To do that you must ensure that the cards you offer are suitable for impulsive purchases. So it would be best if you were careful here what to offer.

Birthday cards account for approximately 60% of all card sales, so they go on the stand. They have many designs ranging from lighthearted, humorous, sentimental and sincere so you can include many types.

About 20% of all sales are of seasonal cards, for example, Christmas, Valentine's Day, Mother's Day, and Father's Day. Since these cards are only needed at certain times of the year, you must keep replacing them here at the appropriate times.

The remaining categories, such as sympathy, wedding, and thank-you cards, individually they make up less than 5% of sales each. Maybe consider including a few generic all-purpose cards, such as congratulations or thinking of you cards, that can be used for many occasions instead.

How to Install Your Stand Installing a stand for your greeting cards.

This is simple and requires little investment. You'll need a little presentation stand. Card companies can often provide this to you for free or at a nominal cost. If not, you can get one on eBay.

Using the stand.

Now you will need to arrange your cards once you have your stand. The most crucial factor is ensuring customers can see and grab them while standing at the front counter since it is an impulsive sale. Bunch cards by type and ensure that every type is clearly shown. Use signage to emphasise the types on offer. Now make sure your stand is clean and well-kept. Most of my clients sell quality items and should be treated with respect. Restock your cards frequently and cut any that aren't selling well. This will guarantee that your customers will always find your stand appealing and up-to-date.

Using Sales Reports to Improve Your Stand.

It's essential to keep track of your sales and use this data to improve your stand to determine which cards are selling well and which aren't. Use your sales reports. You only want your top-selling cards here. Using this information, you'll be better able to choose which cards to include in your stand. The report that can quickly give you your top sellers. Go to the top N stock report, which you can find in the register reports here.

We then put in a period. As a rule, I suggest running this report monthly for this, so select the last 4 weeks. Now you will have your list of cards nicely ordered by quantity, profit and sales.

Summary

> A greeting card stand at the front counter can help boost profits and impulsive purchases.

> Since birthday cards sell 60% of all cards, they should be on the stand.

Christmas and Valentine's Day cards, as well as other seasonal ones, ought to be included and changed as necessary.

> Make use of a presentation stand. Mark the cards by type so that they are simple to see.

> Remove any cards that aren't selling well

> Keep the stand clean and well-stocked.

> Adjust the stand based on the results of sales reports to determine which cards are selling well and which aren't.

Give it a go!

How To Increase Customers In Your Shop

Introduction

In retail, "foot traffic" is used to quantify the number of customers who enter a store daily.

In the retail industry, foot traffic is everything. It is a crucial factor in determining sales. It refers to the number of customers who enter a store each day. The more customers you have, the more chances you have to sell something. To maximise your business, you need to know how to increase it.

We have discussed here how to measure it. Something I urge you to consider.

You can now get sales by time with detailed POS system analysis. Not quite foot traffic but it's a start.

Here we will discuss some ideas on using your POS System to maximise foot traffic in this article.

Importance

The Investopedia it states bluntly here.

"Foot traffic—or customer traffic—is an important metric because higher foot traffic tends to lead to higher sales and revenue numbers."

Everything in a store revolves around foot traffic.

No matter what you do, you won't sell anything if no one is in your shop. More customers mean more sales opportunities in your store.

Here are some ideas to increase it

Use your data in your POS System.

You can identify the most popular products by looking at your sales history. What promotions have worked for you, and what days of the week are the busiest? You can adjust your marketing strategies to increase foot traffic with this information.

Effective Inventory Management Reports

Besides effective inventory management, you can use your POS Software to see what is selling now. Ensure that people walking past your shop in your sign know you have these products. Studies show that in most retail shops, the top ten sellers today will be in the top ten sellers tomorrow.

While doing this, check the trends in Sales. See what people are starting to look for in your shop.

Storefront signage

A shop window can draw customers into your physical retail establishment. Make use of the shop window to highlight promotional offers. Put a simple sign in front of the window that tells people that you handle your popular stock items. This will alert people walking past that you have these products. Do not overestimate the intelligence of people walking past that they know what you handle.

Free online assets

Modern customers often want to know that you can cater to their needs before they arrive; this means you need an online presence.

If you go into Google Maps, ask for your type of shop by going. Here are some examples of what you need

<my shop type> near me

<some popular products in your shop> near me

<my shop name>

I do it all the time. My daughter was hungry a few weeks ago, craving chicken. We had no idea there who had chicken and who was any good. So we used Google, picked the one close with the best reviews, and went there. That shop made a sale from a free service on Google Business.

Everyone now does stuff like this nowadays.

Here is a Google Trend analysis of how often it is done now over time.

Does Google know about you?

If why not, why not? It is a free service by Google and can be set up free in Google Business.

Do you have a Facebook page? If not, why not? Again it is free.

It's critical to ensure your store and the products or services you are online.

Marketing seasons and Promotions

These do sell, which is why majors use them. If it works for them, why not for you?

Several clients told me they did well on Valentine's Day.

It is easy to get hold of relevant ones coming up as the majors advertise them a lot.

Make or Participate in an Event

Making or joining an occasion can be an excellent method for expanding the number of people coming.

Make one for the shop, our birthday sale eg 5 year birthday for the shop.

Suppose you have some technical knowledge. Running classes or workshops works well.

Promotional Deals

Special offers and flash sales bring in people, increasing foot traffic.

Implementing a Loyalty (CRM) Program

You have a free CRM System in your Point-of-Sale System. A loyalty program is one effective strategy for increasing foot traffic. It can encourage customers to return to your store.

Customers in a loyalty program spend more than customers outside your program. It is a fact.

Speed Up the Checkout Processes

Nothing turns people away more than seeing a long queue in today's retail. Utilise your point of sale (POS) software to speed up the checkout process. We can run in our POS system many tills from one computer. That is a cheap way of increasing your tills with little cost.

Conclusion

A retail store's success depends on its foot traffic. You can increase foot traffic and sales by utilising your POS software better at almost no cost.

Take action now to increase foot traffic in your retail store.

A Guide to Retail Traffic Analysis

Introduction

In your POS software, now is what you need for doing retail traffic analysis.

This tool is used by both large and small businesses to determine their success in meeting sales goals and measuring performance. It entails analysing key performance indicators (KPIs) with retail traffic metrics KPIs.

Using them

> You can better control your operations

> Improve your marketing efforts

> Do better rostering

> Examine your opening hours

> Run promotional activities to take advantage of peak traffic periods

> Discover problems in your store

All this leads to increased sales.

Here are the metrics KPIs

Passer-by

This is the number of people who walk by a store. It gives a rough estimate of how many customers a company can get. Because it is influenced by various factors, such as location, foot traffic, and advertising, a small shop has little power to alter this.

Its primary importance in retail is by landlords. They often use it to decide how much to charge for rent because they feel that more people who pass by means more sales potential. The management of a shopping centre often provides such a figure. 

A special meter or estimates are often required to get this number in a strip shop. The difficulty with estimates is that they need daily manual calculations.  

Inside

This is the number of customers who entered a store.

Obtaining this KPI is simple. It is possible to use a low-cost people-counting meter, which can be found in most electrical stores. They range in sophistication, and the one you pick will depend on your required data, accuracy and how much work you want to do. In practice, a reasonably inexpensive one will do for most shops.  With a cheap one, it is more work. A staff member must go to the counter first thing in the morning. Then take the count of people that came into the shop from the counter and reset the counter. Better meters can store data for more than a month. You can set this task to be done monthly. Some talk to a computer, so you have no work to do.

Conversion of a Shopfront (SFC)

Divided by the number of people passing by, or inside customers, the percentage of people who entered the store. 

You can use this KPI metric to determine how many people came into the shop. A store is more successful at attracting potential customers if the STC rate is higher. The shop owner looks at this number to see how much has changed when they make changes to the shop.

Total and number of sales

This information is available in your POS software's sales reports. The following is what marketers enjoy doing.

The average value of a transaction

You get this by dividing the day's total sales by the number of sales. Marketers use this to determine the daily average transaction value. They then use this metric to track your sales performance over time. Using this, they can set realistic sales goals, which businesses set as budgets.

Average profit per transaction 

Marketers rarely get profit figures, so this is a rare practice. Few want to advertise their profit too much to strangers. But getting it is easy for you. You are not telling anyone. It is more meaningful to the business. We suggest using the average profit per transaction; Once more, this data can be determined through your POS software.

So we move to the following important KPI in retail traffic analysis.

Sales conversion rate (SCR)

It compares the number of Inside customer traffic to the number of transactions processed.

A high rate indicates that you are making good sales from foot traffic.

A low number could suggest that you need more staff or different stock to meet the needs of the people in your area. People are coming into your shop, but they are not buying.

Examples in use 

Here is a sample report that you will get 

Here are some examples of how it works in practice.

> Let's say sales were down 20% this week; if you look at the Passer-by, which is the number of people who passed by, you see that this number is down about 20%. Well, you know that you did nothing wrong in the shop.

> If the shop's front was redone. The Shopfront Conversion, the ratio of inside salespeople to passers-by, has stayed the same. The improved shopfront was ineffective.

> You get outstanding stock at a fair price. Then see an increase in your sales conversion rate, the ratio of the number of transactions processed to the number of inside customers who visit your website. It's good what you brought.

Cost/Reward

This is a tricky question; The price for a people counting meter is about $200 to $1,000.  It can be much more too. It depends on where you want to take it, what it will cost.

Although the benefit is also difficult to quantify, it is said to be worth 1%. If you have a $250,000 gross profit, you should achieve a sales increase of approximately $3,000 by implementing it. It will need extra work, how much depends on the meter. Plus, you will need, say, an hour each month to examine it.

Summary

A valuable tool for retailers is retail traffic analysis. Tracking your retail traffic metrics and making data-driven decisions to optimise your marketing efforts can increase sales.

Please let us know if you are interested in this type of technology.

How to Measure Your Shop's Valentine's Day Sale

Valentine's Day was an excellent time for businesses to boost sales, but it did need strategic planning. Measuring sales, analysing data, and spotting improvement areas are essential to determine what happened.

We'll discuss ways to measure Valentine's Day sales in your shop here.

The Importance of Measuring Sales for Businesses

Businesses need to measure during busy seasons such as Valentine's Day. Days like this are unusual; what you will often find on such days can work against you because they are uncommon. This makes it harder to make decisions. Luckily tracking sales have become more straightforward and more effective with a modern POS system.

Sales Reports

A crucial tool for monitoring sales performance is your sales reports. These sales reports will show your profit, bestselling products, and employee performance. Using this, you can identify trends and make data-driven decisions.

How to Track Sales Performance

Go to reports and click on sales.

This report will allow you to check how each department in your shop is doing compared to previous periods.

Now select the dates you are interested in here, in this case, 14 Feb 2023. You will want to run this twice, as you need to compare this day with 14 Feb 2020 (pre-COVID) and 14 Feb 2022 (Last Year). 

I am ignoring for this example all the extra options. You can examine this later after you work your way through this example.

There are many details here; pay special attention to the relevant departments; just click on the left of the report.

The advantages of utilising sales reports

You can determine, in particular, the bestselling products and employee performance by analysing sales data. Your business strategy can be guided by these insights to maximise profits. If you follow what happened on those days, you can identify trends. Then make well-informed decisions about what you did right and what you could have done better.

It can assist businesses in achieving their objectives and making data-based decisions.

Another way to measure sales on Valentine's Day is through employee sales analysis.

By analysing sales data, you can identify employees who perform well and need more training. Some employees did much better than others on that Day.

Summary

> Valentine's Day is an excellent time for businesses to boost sales, but it requires strategic planning and measuring sales.

> Measuring sales during busy seasons such as Valentine's Day is essential for businesses to make data-driven decisions.

> Sales reports are crucial for monitoring sales performance, identifying trends, and making informed decisions.

> Employee sales analysis is another way to measure Valentine's Day sales. This can identify high-performing employees and those who need more training. Using this information, you can boost sales.

Businesses can use this information to boost sales and customer satisfaction.

The Power of POS Data in Retail in Improving your Store Design 

Introduction

In a recent study here, big retailers were asked what they wanted from their data; the big two responses were 62% said merchandising and 60% marketing. 

To do this, you need an appealing and well-organized store in today's retail environment.

Your Point of Sale (POS) data can help improve a store's layout and merchandising in this regard, just like them.
Identifying and using your POS Data

Rely heavily on your POS data to understand your clients' purchasing habits.

Using your POS data, you can highlight your best-selling items.

Go to the top N stock report, which you can find in the Register reports.

We then put in a period, say the last two months; this will show you what is selling now. Then when you have your list of best sellers nicely ordered by quantity, profit and sales.

Take note of top colours and sizes.

Also, consider making them more visible through lighting and signage.

Review what items you sold last year

What worked last year often works this year.

Use the above report with this period, last year.

Look at your merchandise that should be move 

One-way retailers can use POS data to improve store layout is to move merchandise near products often purchased with it, so we look at your items that sell well with other items

Go to Sales-Register > Dissection Companion Sales by Period.

Try looking for an abnormally high number of products for other stuff that sells well with that department. It is beneficial as it can help you select a product to display near a department prominently. This is a well-known method of increasing incremental sales that all majors use.

You take items that sell well with what products of another department and place some of them in that other department's area. There is nothing wrong with a good seller having a few spots in the shop. 

Like this one, a stand of good sellers in a prominent position is always good.

As you can see here (green arrow), there are quite a few extra sales that could be made by moving some other companies' chocolates close to Darrel Lea Chocolates. Darrel Lea may not like it but ....

Another great use is more long-term. If grouped by department, you can get a feel of where you should position the display for the department. As you can see here by the green arrow, the books should be close to the stationery.

You may be able to pick up a few extra sales if people looking at your book can see your stationery too. 

These metrics can give you insights into which products to display prominently.

Regular reviews

To use these reports to keep up with the preferences and trends of your customers and watch shifting conditions you need to run these reports regularly - consider monthly.

Conclusion

For success in the retail industry, it is essential to keep abreast of shifting customer preferences and trends and continuously improve store layout and merchandising strategies.

You can only have a successful store layout if you regularly track your current situation. It is impossible to overstate the significance of adaptability and continuous improvement in-store layout and merchandising success.

Use your POS Software with Inventory Replenishment

Introduction

Inventory management is an essential part of any business. Businesses need to meet customer demand and avoid stockouts or excessive stockholding. This can only be done by maintaining an optimal stock level that meets customer demand.

Here I will discuss one of the most used methods, inventory replenishment. I will explain how it works and offer suggestions for how to use it to improve your inventory management process.

How is inventory replenishment carried out?

Each item under inventory replenishment has a minimum and maximum desired quantity. These can be either done automatedly or manually set by the user. When the stock-on-hand figure drops below the minimum, the order will be the quantity required to reach the maximum desired figure. Of course, our software has to handle some limitations. For example, the re-order quantity and lead time (the time a supplier takes once they get the order till they deliver the order). If in place, a small business order fee some suppliers charge must be considered too.

If it is done manually, the items are counted. Otherwise, the computer will monitor inventory levels and make a restock alert.

Types of replenishment

Periodic ordering ordering

Done periodically, say when a sales representative comes into the shop or the weekly order is scheduled, the order is done. Your minimum and maximum figure must also consider this cycle. The significant advantage is that you can concentrate on the order as it is done systemically.

The periodic replenishment strategy is ideal for products with a short lead time and high demand.

Re-order Point

The orders are done as the stock falls below the minimum. This involves more work as more orders need to be done, but it reduces your stock holding. In practice, you need a functioning Pont of Sale system to do this, manually, it's too much work.

Demand Replenishment

The process of ordering new stock in response to actual customer demand is known as demand replenishment. Here you use expected demand to calculate the minimums and maximums figures automatically. This is calculated in our system by an AI. It compares your stock-on-hand figures with these demand figures plus adds the uncertainty figures to calculate the order required.

Real-Time Inventory monitoring

To make it work, you must manually count your stock continuously or keep the correct stock levels in your computer system. This ensures that the appropriate inventory quantity is available at the proper time. It is best to have the correct stock figure in your system.

Monitor and change your replenishment strategy.

In practice, it is essential to monitor and modify your replenishment strategy as required regularly. This optimises the process of replenishing your inventory. It could mean switching to a different replenishment method, altering your re-order quantity, or changing your re-order points.

Conclusion

Inventory replenishment is one of the most popular methods of inventory management. It ensures that inventory is available when required without an excessive inventory that becomes obsolete and wastes valuable storage space.

I hope this helps some to understand how it works and how the various replenishment strategies work.

Steps To Make Valentine’s Day a Success for You

Introduction 

With less than a week to prepare for Valentine's Day, it is quickly approaching. 

Lastest research estimate here from the Australian Retail Association 

The prediction here is that Australians will spend nearly $500 million. That amounts to approximately $118 average spend by Australians this year which is up. COVID-19 affected people's interest in Valentine's Day last year. This year should be up since there will be no restrictions on this Valentine's Day. 

Google for this year's outlook looks like this.

So by Google, interest currently is slightly lower but comparable to previous years. This makes sense as even in the middle of the most significant pandemic we have all experienced, with its unprecedented shakeup of our economy. Consumers did not cut back their spending on Valentine's Day. 

That is a lot of sales, so if you want your part, you must prepare. Let's get started and find out how businesses can get the most out of this romantic day.

Researching sales data from the previous year.

Now, if you want some ideas, see what does sell in your shop on Valentine's Day and what stock you have. It will take seconds to discover and give you some good ideas. Remember, unlike other marketing holidays, many products on Valentine's Day are still marketable afterwards if you select wisely. 

So in your POS software, look at the Top N stock report, which gives you the top-selling items.

Go to Register Reports marked in green.

Select stock.

Now you will see two reports. Click the one on green first. The purple you should hold in memory as you may need it before placing an order.
 

 
Now select last year's Valentine's day and the top 40 items, which should be plenty. I suggest doing it by quality sold.

You will get a report with top sellers over Valentine's day, plus your current stock holding to see how you stand for Valentine's day.

Also, run his report for 2019. This was the pre-pandemic period, and one expects this year to be a mix of last year and 2019.

We now have a list of the products sold well in your shop. That took less than a minute. Now make sure you have enough stock.

Embracing New Trends 

You need to contact your suppliers to see if they can suggest new products - chocolates, flowers, romantic gifts etc. 

Go beyond romantic gifts. 

People on Valentine's Day today, as well as romantic partners, are purchasing gifts for close friends and pets.

Check that you have gift wraps and cards. Many people need this to add a personal touch to their purchases. 

Create a Valentine's Day-Specific Section in the shop. 

It is creating such a specific section in the shop increases sales dramatically. It doesn't have to be spectacular; it does not have to be big. Put your Valentine's products on the stand.

Put cute messages on signs to decorate the front of your store to attract the attention of passing shoppers. Spread the love. 

Consider offering a gift-wrapping service.

It is a simple, cheap way of differentiating from business and gives you a professional and personalized touch. Employee training in the fundamentals of gift wrapping is not hard, and the added value it can provide can be well worth the effort. Learning to do it is not difficult and only takes a little practice. Once you get going, consider having * free * and * luxury * pricing services. Luxury includes a card, so a toy becomes a beautiful gift wrapped in attractive wrapping paper with a card.

Email and social media campaign

If, as suggested, you have a loyalty program, why not send out a free newsletter through Mailchimp? If your company has a Facebook page, posting a few photos in a post is a great idea.

Conclusion

You can have a significant chance to boost sales and connect with customers on Valentine's Day. 

> Prepare for the holiday by using sales data from the previous year, taking into account changes brought on by the pandemic

>Stocking up on merchandise related to Valentine's Day

> Embracing the new trend of buying gifts for friends and pet 

> Creating a special section in the store

> Offering gift-wrapping services

Please make the most of this romantic holiday.

With Our Advanced Systems, you Take Control of Your Inventory.

Introduction

In the retail industry, your inventory management system is a crucial component that can make or break your company's success. You can ensure that you have a more significant number of valuable products on hand. They are manageable if you have an advanced inventory control system like ours in place. Businesses can improve accuracy, increase profits, and streamline inventory management procedures by utilising POS software.

By the time you get to the end of this article, you will have a clear understanding of how our point-of-sale software can help you. So, improve your retail business. Take your inventory management to the next level.

How POS Software Can Aid in Inventory Control

An explanation of how POS software can improve inventory accuracy

Well, you get inventory control. You can track inventory levels in real time using POS systems that integrate with barcode scanners and other devices, ensuring they always have an accurate picture of what's in stock. Overstocking and stockouts, which result in lost sales and dissatisfied customers, can be avoided.

Managing your inventory is streamlined by POS software.

As well as increasing inventory accuracy, POS software can simplify inventory management processes. POS software allows you to manage stock, reorder products, and track inventory levels. With this, you can help you concentrate on other aspects of your business while reducing errors and saving time.

Real-time inventory levels

You can access inventory data at any time and location with POS software to make better decisions about your operations. You can be better prepared for the future and anticipate possible stockouts. You can work more efficiently due to this. 

Costs associated with poor inventory management

Less revenue is generated, and more is lost due to stockouts. Stockouts often result from poor inventory management.

Inventory management can lead to increased labour costs, as employees spend more time managing the merchandise and less on other tasks.

Customers who aren't happy

Poor inventory management can also result in customers who aren't happy. When they can locate the required products, customers may become frustrated. They might not come to you the next time, so they might go to the shop with what they know has what they need.

Obsolete stock

Overstocking can also be a problem. What happens here is that you are accumulating unsellable inventory. This clogs up valuable resources and costs money.

Cash Flow

Improper inventory management hurts cash flow because it ties up funds which are often financed through debt.

Beginning inventory tracking

Requirements for hardware and software

To begin using POS software for inventory control, you must get the required hardware and software. Barcode scanners and a POS system are part of this.

Training

After installing the hardware and software, you will need to use the system correctly. Training on data access, sales processing, and inventory tracking are part of this.

The significance of a stocktake

A stocktake is a procedure of counting and confirming the number of items in stock. Regular stocktakes are needed to guarantee that the inventory records are accurate and current. There is no other way to get accurate numbers. It is easier as our software includes built-in stocktake functionality, making stocktaking faster and more effective.

You can identify discrepancies in inventory levels. Then make necessary adjustments with regular stocktakes. Improved productivity, accurate inventory records, and prevention of stockouts and overstocking are possible.

Take Control of Your Inventory

You can manage products, prices, and inventory with the Ordering New Stock feature. You get control over your stock. You'll be able to quickly and effectively add new products to your store. Also, set prices with this feature. This ensures that your inventory is always accurate. By staying on top of your inventory levels, you can reduce the likelihood of stockouts and overstock. This allows you to make better business decisions and increase efficiency as you can manage your inventory efficiently. This feature helps you better control and manage your stock.

Advanced Inventory Reporting

With POS software, you can now access advanced inventory reporting features. This provides in-depth data on sales, inventory levels, and other KPIs.

Sales by Vendors

After that, you can keep track of your suppliers' sales using advanced inventory reporting. It is too familiar today for retailers to understand less what sells in their shop than their suppliers do. Many bad decisions can result from this. Using our advanced inventory reporting, you can make more informed purchasing decisions now if you know more.

Inventory by Category

You can get in-depth information category. You can use this to determine which products are selling well and which aren't. Businesses can use this information to decide which products to keep on hand and which to drop.

Conclusion

Controlling inventory using POS software can significantly benefit your retail business. It can provide real-time visibility into inventory levels, streamline inventory management procedures, and enhance inventory accuracy. It can help you make better business decisions and increase overall efficiency by offering features like tracking sales by supplier or category and ordering new stock directly from the inventory system. A solid inventory management system can prevent stockouts, overstocking, and lost sales, resulting in increased profits and customer satisfaction. You can control your inventory and take your retail business to the next level by investing in the necessary software, hardware, and training.

Your company's success will be supported by good inventory management.

Call to action

Please use a cutting-edge inventory management system like ours to ensure you always have enough of the right products. Our point-of-sale (POS) software can assist you in gaining control of your inventory and taking your retail business to the next level by streamlining processes for inventory management, increasing accuracy, and increasing profits. For more information about our system and to set up a demonstration, get in touch with us right away. Don't delay; Now is the time to take charge of your inventory and begin reaping the rewards of better inventory management.

Extra questions

Q: Can my retail inventory be connected to eCommerce?

A: You can connect your retail inventory to eCommerce, yes. You can link your physical stock with your online store with the built-in integration capabilities of our inventory management software. This assists you in monitoring stock levels across all channels and ensuring that your online store always has up-to-date inventory information without using another system.

Q: Can you help me predict future sales? 

 A: Of course! Our system helps you forecast sales using your historical sales and stock levels over time. This it uses to estimate future sales of your products. This is a great way to plan for your future needs.

Q: Is it possible to keep track of information like inventory levels and serial numbers?

A: Yes, you can track data like inventory levels and serial numbers with many inventory management systems. Businesses that sell high-value items or products subject to warranty or recall can benefit most from this. By keeping track of serial numbers, you can quickly determine which items are in your inventory and where they are. This can help you track and manage your inventory more effectively. It also helps you manage warranty claims or recalls better.

 Q: How does it help me to arrange my products better?

A: Our system easily controls and tracks your inventory by allowing you to develop and organise products into different categories easily. This way, you can quickly find and control products. By monitoring inventory by type, you can also see which products are selling well and which aren't. This allows you to make better decisions about items to keep and dump.

Q: Does it help with product classification?

A: It allows you to organise products in many methods, typically by department, category, or supplier, so you can easily scrutinise your sales and inventory levels by these methods. This aids you in making better purchasing decisions. Then our advanced inventory reporting feature gives you detailed information on sales by these methods, so you can see which products are going well and which aren't. 

How to build your Basket Size? 

The retail basket size is the average number of items in a customer's transaction.

Study shows that the largest 20% of shopping baskets on average generate 50% of unit sales, and 40% of dollar revenue. That is huge if you think about it. What it shows is that the size of the basket accounts for much of a company's profits, so knowing this metric is essential. So we will discuss methods for increasing retail basket size and how to measure it.

Theory of basket size

Getting customers to buy something is a big business problem. In practice, they often do buy more after deciding to make one sale. The second item is often less competitive because the customer evaluates the first product more than the second. Often to the retailer, there is more money in the addon sales than the core.

Time

Getting customers to spend more time in your shop is one of the most important ways to increase the size of their baskets. Studies show consumers make more purchases the longer they spend in a store. For example, people in superstores buy more because they spend more time in them. One way to get customers to spend more time in your store is to offer in-store experiences. Bunning, for example, with their free classes on hardware, knows what they are doing.

Products for the size of a basket

You need items that sell with other products. What you will see are these products in your companion reports. Consider these recommendations.

Navigate to Sales-Register > Dissection Companion Sales by Period in your POS software.

Try looking for the items that sell more than other products. You should ensure that these items are prominently displayed. To maximize and increase sales, majors often show these items in many locations under different categories. For example, a Christmas Card can be shown in the Card department and the Christmas section.

Finding these Companion items

In your POS software

Go to Sales-Register > Dissection Companion Sales by Period.

Look for items that sell well with other departments. It is beneficial as it can help you select a product to display near a department prominently. This is a well-known method of increasing incremental sales that all majors use.

You take items that sell well with that department and place them in that department's area. There is nothing wrong with a good seller having a few spots in the shop. 

Also, moving products by type rather than supplier, e.g. moving some of the chocolates other businesses produce closer to Darrel Lea Chocolates, could result in many more sales. Darrel Lea might not like that, but...

As you can see here by the green arrow, the books should be close to the stationery.

I've noticed that phone recharges in tourist areas help sell other products and are worth handling despite having little value in themselves.  

Now, if you've found these things, you should look at the following:

Design of the store

If the layout and design of your store are clear, it will be easier for customers to find what they're looking for. This makes it more likely that they will buy something. Goods that are impulsive sales should be visible. 

Promotions.

Retailers can use sales and promotions to get customers to buy their products if they have the right ones. Increasing the size of a customer's basket encourages repeat purchases.  

Product bundling

By making bundles of products, retailers create more customers who will buy more.

Measuring the Size of a Retail Basket

Navigate to End of Day > Reporting > Average Basket Size by Hour (picture)

Then enter a date to observe how the size of a retail basket changes depending on the time of day in your store. The time can be significant. Find out why?

We've broken it down by account and retail sales; Generally, we observe larger basket sizes in account sales. 

Conclusion

You can increase the basket's size in various ways.  The most apparent benefit of increasing a basket's size

> It increases total revenue and sales. Profit rises in tandem with higher sales. 

> Customers are more likely to return to a store and make more purchases if they spend more money with you. This also increases their lifetime value as a customer. 

> If you are shipping, you reduce the costs of handling transactions, shipping, and logistics by increasing the basket size.

Why Data-Driven Retailers Can Be so successful

Introduction

I often meet big, small, and everything between retailers as part of my job. Besides frequently having big egos, large retailers operate in results-oriented and data-driven environments.

From personal experience, do yourself a favour and never overestimate a person's intelligence with a budget of tens of millions of dollars,

Where do they succeed? Well, large corporations often replace decision-makers if they fail, even when it is not their fault. I remember one marketing executive who told me he was the third marketing manager in his organisation in the past year. Data measure them. Why can you not use data?

Research

Experts are consulted before they begin working on an idea; They use experts while carrying out the idea, and if they abandon the idea, they also use experts. Almost all is planned and monitored in their stores and marketing. I have some excellent suggestions for you:

> Take a look at a few big retailers your business can relate to.
> Look what they did
> Take notes on what you find interesting.
> Come back to see if you can use it yourself.

You will gain many insights and copying costs you nothing.

Measuring the effect of improving.

You now have an excellent reporting system in your POS software so that you can measure it as well; in fact, it is superior to most majors. Partly because I always take notes after I visit majors, and if I like something, I put it in your POS software.

Let us start with the following:

Suppose your shop sells your customers $150,000 worth of crafts in a department. If the cost of the items for sale is 50% or $75,000, your gross profit is $75,000.

Real-time Data Tracking and Analysis Using data.

Now, let's see what you can do with only minor adjustments. You try to improve by 1% by buying more of what people are buying. Do not underestimate modern retail analytics.

By using A/B testing and monitoring in your shop, you should get an additional 1% increase.

Professional loyalty program

Introduce a professional loyalty program into the shop. It is free in your POS Software in the CRM so that you can personalise your customer's shopping experience. Personalize product recommendations, targeted promotions, and even in-store experiences with its help. It should be good for another 1%.

Sales are now up by 3%

Inventory management

Since you use your reports to buy better, you should enhance your inventory management to get better margins by a 1%.

Your supply chain efficiency improves as you order in smaller lots using AI that optimises your stock holdings. As a result, you cut back on purchases and buy fewer things that don't sell, which reduces your margin by another 1%.

Result

Sales are now $150,000 plus 3% = $154,500

Cost of sales is now $154,500 less 2% = $$74,160

Our gross profit in this one department is now $80,340 or 7% higher, and all we have done is work at 1% by simply using the data and systems you have.

You can do this for each department, and I have not even discussed dead stock, shop theft reduction here, etc.

Conclusion

Being a data-driven retailer today is essential today. Make good decisions with the tools you have at your disposal.

Data-driven retailing is the way of the future.

How to Set a Product's Price in Your Store

Introduction

Setting a product's price is one of the most critical business decisions because it affects profit. To do it, you need to consider many factors, such as your costs, the cost of the goods, competition, and customer expectations. Determining the appropriate price point for an item can be difficult. This section will discuss the various aspects of pricing an item in a retail store and how POS software can assist you.

Determining the retail price of the item

Some suppliers may set the retail price of a product or service. As the supplier has already established the retail price, you do not need to worry about setting the price. You are here obligated to sell the product at that price if you wish to sell it.

Yet you are responsible for selecting many products for which there is no established retail price, and we will discuss this here.

The most common method is:

Experience

Most seasoned retailers will be able to determine what they can change for such an item just by looking at it, so they keep this price in mind. 

Calculation (pricing model)

The retailer will add shipping and handling costs to the product to make their price. Then multiply that number by their markup to get a starting price.

This your software can do automatically when it is stock received.

For instance, if they take the wholesale price of 95 cents, they add extra charges like delivery, which will add approximately 10 cents to the item. To handle such a product, they typically charge a 60% markup. This covers their fixed costs plus their variable costs. So the starting price is $1.68, which equals 60 percent plus the 95 cents plus 10 cents. Then they make it a reasonable price of $1.70. Some people here would also set a floor price which is the small necessary to sell an item, say 25%. Their floor price then is (95 cents+10 cents) plus 25% = $1.31, so they round it to the nearest reasonable price to make it $1.30.

We now have a price range of $1.30 to $1.70. 

Market research   

Understanding the competition is crucial in determining a competitive price for a product or service. It can increase the likelihood of market success.

When setting prices for a product or service, you must know who your competitors are. Researching the prices of similar products sold by other retailers is one way to do this. This will help you determine a competitive price and give you an idea of how much similar products currently cost in the market.

What if they look around and see that other people in the area are selling that item for $1.20? Well, that is less than their floor price of $1.30, so the question is whether it is worth handling. If they decide to take it, they would need a good reason.

But, it becomes viable if they look around and notice that other people in the area are selling the item for $1.80, more than their starting price. The question here is how much they should ask.

Here is an interesting question, what if the item sells for a considerable amount, like $40? It happens. One of my customers was going to Bali for a vacation, so they decided to let a local wholesaler know they were coming and ask if they could meet. No problem! They were shown many items, including some vases for fifty cents. At that price, they bought many vases. After that, he returned to Australia and sold them for $12.50. They were delighted until they discovered that similar vases were going for $45. Then they felt stupid. Before establishing a price, you must conduct some research. 

Besides researching prices, it is essential to determine competitors' target markets and pricing strategies. It may provide insight into the product and the type of customer it attracts. This can aid in understanding which strategies to use. Also, knowing your competitors' pricing strategies and target markets can help you figure out where you might fit into the product market you're entering. Can you handle this product as an orphan, or do you need to buy several different products because it's a range? This should be the first question you ask.

Consider strategies for psychological pricing.

Retailers use psychological pricing strategies to change how consumers perceive a product's value through pricing tactics. 

The odd cost of 99 cents.

In this case, $2.99 seems less expensive than $3.022. This does work in some lines, like giftware, where it makes a product appear more affordable and makes the customer feel like they are getting a deal.

It appears preferable to maintain it at $3.022 in other lines, such as those for bulk products like motor oil. It gives the impression that you are more authentic.

Anchoring

For any significant line, you should always have two products, one cheaper and one more expensive. When someone comes into your store to buy something, they see the cheaper item, say at $12, and the more expensive item, at $15. Frequently, the customer concludes, "I'm going to pay $12; I can for a little more get the better one for $15." It also gives the $12 one more value because it looks cheap, giving the impression that they get something almost as good for less money. 

One of my customers handled two identical products, one of which was blue and the other yellow. Because it was more attractive, they increased the price of the blue one slightly. Despite the higher price than the yellow, they sell more blue. 

Track sales

Prices are not set in stone. Maintaining a profitable business necessitates adjusting prices as needed. This involves seeing how the product goes in your shop by keeping an eye on sales, customer feedback, market trends, and competition.

Always use your sales reports to monitor your sales. 

If sales are low, businesses might cut prices to get more customers. Businesses may raise prices to maximise profits when sales are strong.

The good news is that you have a unique report which gives you an immediate way of checking your current situation.

In the Cash register report, call up the GMROI (see the selection highlighted) in your point of sale software in the reports here.

You can select the list of options you want, and I suggest you go over these options later.

I recommend doing this by departments for a first run.

Then you will get a report like this.

The items are all listed and rated by financial with low stock-on-hand figures, decent sales, and ROI% figures. The ROI% is the return on investment; it is one of the best ways to determine how valuable your stock items are to your business. It is calculated by the (unit sold) x (Profit)/ (Average stock cost).

Conclusion

While there is no right or wrong way to price products, getting it right ultimately affects your profitability. It's not just about setting a price; your customers are in charge. Businesses can make well-informed pricing decisions that help them remain competitive and maintain sales by keeping an eye on sales, customer feedback, market trends, and competition. Also, it enables businesses to adapt their product offerings to market trends and customer requirements. Businesses can maximise profits and maintain sales by offering the best price and product.

Stock Turns: What it is and how it Works!

A stock turn measures how many times a product is sold and replaced in a given time. This ratio determines how your business performs and how well your inventory management works. In retail, businesses want as high a stock turn as possible. While maintaining low inventory costs and having their customers correctly supplied.

Stock turn measures the frequency with which a stock moves in your shop. It is a critical KPI for retail.

Manually it is calculated as 

Stockturn = (Cost of Goods Sold) / (Average Inventory cost)

But computers work by quantity so if you have sold 100 in a year and have an average of 20 in stock, your stock turn is 100/20 = 5. The magic number is 12 as most suppliers give a month's credit so 12 means you do not pay for the stock. 

How to calculate your stock turns.

Main Menu > Cash Register > Register Reports > expand Stock > select/double click the report “Show Stock Turn by Dissection and Item.

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

Best practices for analysing stock turns

Much has been written about this, but generally, a higher stock turn rate is better, but this is only sometimes the case.

Look at the high and low numbers.

Low stock turns

Any business should be wary of a low stock turn rate because it indicates that you are not selling these items as quickly as you are buying them. This could be brought on for many reasons, such as having too many slow-moving products or needing better inventory management. This ties up capital and space that could be used for other things. So you must determine the cause and take steps to rectify it.

High stock turns

Conversely, a business with a high stock turnover rate moves its inventory quickly. Although generally regarded as positive, it may also show that you need to sell too cheaply; if so, consider selling less for a higher price.

Also, it could indicate that we need more stock to meet customer demand. You may have lost sales. This can hurt your company's reputation as your customers can't buy what they want if this is the case. The cause could be brought on by inadequate inventory management or poor or inaccurate forecasting.

Just in Time

Implementing a "Just in Time" inventory management system is a standard method for increasing stock retail.

In retail, this is commonly stated as

"Buy small and often"

We order products as needed here instead of ordering large quantities. If your stock ordering is automated, this is easy to do. It helps to keep inventory levels low and free up capital, but if something goes wrong, it could result in no sales because there would be no stock.

Conclusion

A modern retail business keeps track of stock turns as a crucial metric. By implementing stock turns analysis, you can ensure that you as supplying your customers with their needs.

What is ABC analysis, and why should you use it in your shop?

Purpose:

Introduction

Any retail business's success depends on effective inventory management. You could lose money if you don't manage your stocks. You will need more time to meet your customers' requirements if disorganised. While too little inventory can result in lost sales and dissatisfied customers, too much stock will tie up capital and space.

Fantastic, you may say, but the issue is that there is so much stock that manual control is impossible. You can use your POS Software with automatic ordering (with our AI focusing), a standard manual system, or both using the ABC stock control, one of the most popular methods for inventory management.

Note I will discuss ABC here a few times on the blog so that this post can introduce the ideas. I am sure you will be impressed.

The issue

A typical business can sell tens of thousands of different products annually. One cannot control all these items in your head. Although our AI automatic reordering can be beneficial, it lacks the human element, which is a significant drawback. It knows what happens and estimates what will happen, but nothing about what is happening outside your shop.

Let us start doing ABC Stock control

Deadstock

This is a common problem in retail, so first, let us remove the Deadstock. We define Deadstock as any item that has not sold in the past 12 months based on sales. This stock both cost money to the retailers, ties up cash flow, and money and takes up space that should have stock that sells better.

Now in identifying your products that are dead, go to register reports,> stock titled "Old Stock on hand by Date last received"

I tend to do it in two parts. I check the overall problem in the shop to see the scale of the problem. Then I go by the department in detail as its people find it better to examine this way.

What will you do about it once you have identified it? I would suggest moving it because it may be in the wrong area. A good clean, and excellent presentation can do wonders.

If its really not good well mark it as Deadstock to stop others from ordering it, and stop suppliers who know it's dead stock to try to provide it to you underhandedly!

Here is a simple and effective method.

When you receive stock items in the shop that you'd rather not see again, press edit in your POS Software; see image.

Then mark the stock item where the red arrow is.

Our system will no longer automatically order the product from that time. If it comes, when processed, the stock item will be automatically recorded in the instant return file. As a result, you will be forewarned and have the opportunity to act before accepting the dead stock.

Classify ABC

Now list inventory sales using profit or sales numbers from computer reports. In practice, often, there is little difference; some prefer numbers while others profit. You pick.

So go to Register reports > Stock> Top N Stock Sales for a Given Period.

Now using your ad hoc reports, you will get a screen like this. I made a total column.

There are 10,289 stock lines sold in this shop 

This is what a sales analysis of stock lines by total% looks like, and it is not that far off the 80/20 rule. The top 33% of items had about 80% of the shop sales.

Now the top third of your sold by % (33%) are your A's

So we have here 58, A products. Now commonly, people adjust; you do not want the number of A's between 40 and 100 items as manually that is about as many as you can handle.

The B's are between 33% and 66%

We have almost 1600 of these items.

The remaining items are your C's.

Just over 9,000 items, and most of these are very marginal.

Hence we have now done an ABC Stock Control, also known as the "always better control" method.

implementing ABC analysis 

You can keep track of a significant part of their business in your head by concentrating on your A's. You should advertise those products by placing them in prominent locations where enough customers can see them.  A significant increase in sales can be achieved by making minor modifications to your A products layouts. Here with just looking at 58 items, I have done a third of the shop sales.

Now, look into your Deadstock and C's. These products are not moving or moving very slowly. It may not be the product; you may be charging too much.  Regardless of the narrative, you must act on these items. 

Conclusion

An ABC analysis is a method for maximising your inventory. After analysing your inventory and classifying each item, you can start reaping the benefits of using the data to improve results.

FAQ

Q: How long does the process take?
A: It took me here in under 15 minutes.

Q: Can it be done on a department-by-department basis rather than the entire shop?
A: I suggest doing it twice. Once for the store, you can get a global view of your business and once for each department.