Inventory

Planning and maintaining an ideal inventory level for a brand or store is like trying to maintain an ideal weight.  If you get to “thin” your assortment is weak and you can’t meet your sales goals.  Customers get discouraged because they can’t get the sizes, colors or styles they want.  They turn to a competitor and may not come back.  When you let your inventory get “overweight”, bloating and sluggishness sets in.  Your goods hang around longer and turns go down, your promotional dollars go up and margins go down, your merchandise investment becomes less productive.   Your customers may find the excess unattractive.  To thin or to fat you can’t win.  You have to strive for balance to achieve stability yet maintain flexibility to go after growth.

The bottom line is you can only achieve consistent profitability by having a substantial supply of the things that customers want when they want them and by having a good deal less when they don’t.

Enjoy other articles on Inventory Management: