It is true that on initial thought stocktaking in-house seems like a more cost-effective option for your business. Why pay someone else to do it when you; have staff that you are already paying, that know your store and the products and can do it at a time of your choosing.
Unfortunately, as with most areas of business it’s not as straightforward as you may have initially believed. Have you considered;
Staff, in general, do not like counting
Costs of training staff to count
Cost of overtime for staff that are stocktaking or losses from closing store to carry out the stocktake
The hassle of scheduling staff
Additional management hours are spent monitoring counting staff to ensure accuracy
It is taking vital management and staff time away from customer needs and business operations
Staff are not trained to do this job every day, inclined to make mistakes
The costs of renting scanners and equipment
If not using scanners than the time wasted on double entry can add costs
Stocktakes take longer than expected, skewing data as purchases and sales are continually occurring
Same day reporting may not be possible
These are areas of in-house stocktaking that people don’t account for when calculating costs and accuracy of their stocktakes.
Comparing these to outsourcing your counts to an external company, you can see the differences;
Staff are trained in counting, guaranteeing efficiency
Doesn’t take staff away from working with customers
Counts carried out during opening hours
High quality scanning equipment
Counts are carried out quickly, efficiently and accurately, reflecting your actual margins
Reports are received on the day of the count without delay.
There’s a lot more to the costs to in-house stocktaking as initially thought, so remember to consider all costs and time spent on planning the stocktake before deciding that it is the cheaper option.
Sometime the cost reflects quality; is your business worth it?
For many managers stocktakes, whether monthly, yearly or anything in between are usually the most dreaded time of the period. The mundane chore of counting every single item on the shop floor, in store room and warehouses as well spending minutes or even hours in fridges and freezers, all to do it again in what seems like no time at all. Funny thing, this isn’t even the worst part! After all your stock is counting and accounted for you then need to sit down, probably at a computer screen and spend hours entering this data into a spread sheet, calculating costs and different measurements, entering the deliveries for this period all to view a single figure that is your gross profit percentage!
Good news! There are ways to make this easier; first, take a day or two, not a day off, a day to clean up, clear out and get organised. Set up a system that will work for you and your staff. The time you save will outweigh the time you spent, tenfold. Once your new and improved system is in place, ensure all your staff stick to this new set-up.
Don’t count individually. If your AA batteries come in a case of 12 and never vary, count them as 1 and account for the amount inside at the end, eliminating mental calculations that are often a struggle or lead to an increase in errors. An important thing to note here is to try and keep control over what is being opened and making certain that the previous package of this item has been used completely. An accumulation of half used produce makes counts more difficult, messy storage areas and a higher likelihood of spoilage if your stock includes perishable goods.
If you have counting templates for your items adjust these to suit your counting flow. You want to fly through these counts and knowing where every item is in your store room and on your sheets, will speed up the process. Change your inventory sheets to reflect the order in which you have your store area set up.
If you are using scanners and most of your items are barcoded you won’t need count sheets however, sticking to a flow or trail will allow you to count quicker and not overlook any areas or stock.
Unfortunately, no matter how much you tidy up, you cannot avoid the horror double entry. All that data that you collected must go somewhere to be of any relevance or give you an insight into how your business is going. But there are ways of easing this data entry; banking on the fact that you have some experience in excel. Set up a template in an excel workbook to include your products, case costs, case measurements and so on… You can find these templates online if you are unsure of the correct calculations.
There is no easy way to add deliveries unless you have been accounting for each one as they arrived, since the last stocktake you carried out. On top of this there is the issue of damaged goods or allowances. Accounting for these is one area of business that if you avoid, you end up questioning your margins and wondering why and how?
However, if you want to cut out all staff training, count sheets and most importantly double entry you can always choose to go with an external stocktaking company. Stocktaking.ie provide counters that are the best at what they do, the highest quality equipment that allows for efficient counting; “in and out, job done”. Not forgetting the most important offering, receiving your reports on the day of the stocktake, no messing around with double entry and spending days trying to reach your correct profit margins.
Sign up to our newsletter here for more tips on running your retail business.
The Christmas decorations have been boxed up and put away, everyone’s ditching the booze, the fitness DVDs are out and the masses of shoppers are nowhere to be found. As a small business owner these few weeks are seen as the worst time of the year, however there are some steps that may be taken to ensure less of a decline in sales.
Are you ready to start the 2017 ball rolling? Is so, here are a few ideas to combat possible plunge in sales.
1. Have a positive attitude
It is true that sales are known to generally hit a slump for almost all retailers in January. And because of this, a decline in sales becomes a self-fulfilling prophecy. Don’t allow this to happen, take a stance against it and go forth with a positive attitude.
Your attitude will do wonders in setting you apart from other business owners. Look into any offers, deals or discount you could use to your advantage in promoting your products or brand to your current customers or even some new ones!
2. Emphasise the importance of you
Your customers have been prioritising their loved ones over the holidays. This all stops in January and people start to focus more on themselves, and why wouldn’t they? Focus on the customers themselves, remind them to use their Gift cards or let them be the first to see new products or promotions.
If your products/services fit into a category of self-motivation, improvement and fitness put these in front of the customers. Let them know you are behind them in their resolutions.
3. Know who you’re targeting
A common thread across small businesses is not having focussed marketing strategy. The impact of this marketing can be weakened if it is aimed at the wrong target audience. Why do customers choose you and your business? You need to show them what they want to see, meet their needs and be strategic as to where and how you place these advertisements.
If you are unclear about who your target audience are, take a step back to rethink and re-evaluate. Start with the simple areas like demographics and then delve deeper. Think of new ways to get the information, where people will be willing and most importantly honest.
4. Get Social
Twitter and Facebook are always a good place to start, but think about your clientele and where they ‘Hang out’. Your social opportunities could be endless if Instagram, Pinterest or LinkedIn however, social media can be a waste of time if you are targeting people in the wrong place.
Capitalise on social media by being unique and creative. Share photos and videos of your team, products and offerings. Share content relevant to your followers. Use SM to respond to customer queries and host competitions and giveaways to increase awareness, the world is your oyster with social media.
5. Define the data
None of this work will have any relevance if the results of your hard work aren’t being measured. Return on investment needs to be monitored as if nothing comes back from all your efforts you need to consider what next action to take or where it all went wrong.
January however should be the ideal time to get this up and running, a fresh start so to speak. All of this made even better by the fact that your competition may be still picking up the pieces after the December rush.
Good luck with it!!
Sign up to our newsletter here for more tips on running your retail business.
In 2015 alone there was an estimated €255 million worth of stock stolen in Ireland with €56 million of that being lost over the Christmas period. This doesn’t account for loss due to damaged goods, pricing discrepancies in-store and miscommunication with suppliers. There are many ways to reduce stock losses in your retail business; hopefully these can have some influence on lowering these costs for your business not making you another statistic. We have compiled a list of 10 ways to reduce stock losses;
1.Use an EPOS system
Your EPOS system is a great asset to your business, many businesses do not realise the full extent of what it can do. It is an expensive tool but is often used as a cash box rather than to manage stock and cash flow more efficiently. Use it to track transactions, restricting employees on what they have authorisation over. Set the system to only allow discount, refunds or voids to be carried out by a manager.
Link it so card payments are processed at the EPOS terminal, some of these are automated to read the total amount onto the card reader automatically. If the amount had to be keyed in manually by an employee it is not integrated. There are many reasons why these would not be integrated; usually due to costs.
2.Figure out who is stealing
There are many potential culprits causing the decline in your stock. Your customers, employees or suppliers are all possible threats to your business.
Your Customers – Usually for personal use or to resale.
Your Employees – There are various reasons that employees steal from their companies from lowering prices for friends, dissatisfaction at work. A modern EPOS system can reduce this.
Your Suppliers- Suppliers and contractors might overcharge you, resulting in costs for services or products that you never actually received.
Incorrect pricing- pricing items incorrectly would both be examples of errors that will add up to significant losses.
3. Have security in place for both customers and employees
Install CCTV. Installing visible security cameras throughout the store and storeroom has been proven to deter thieves. Be conscious of having cameras visible to the public but also subtly remind your employees that the security cameras are working and monitored often. Review the cameras weekly, even if there are no clues of shrinkage.
Erect signs- Post anti-theft signs around the store, warning of penalties that may occur as a result of theft.
Placement- Near the entrance/exit of a store is the optimum position of the cash registers. If possible try and have your store, if not some of your store visible from the till. Valuable items should be placed a close to the till as possible for ease of surveillance. Shoplifters are less likely to act if they know surveillance is high.
Secure stockroom- Ensure your stockroom isn’t easily accessible to everyone, even to all staff members in some cases. Having limited access allows you to choose who has contact with back room stock, cutting down on potential theft.
Educating your employees about retail theft – It is important to educate your employees about the effects of retail theft on your business.
Encourage employees to monitor people closely and be aware of suspicious behaviour. If they see this behaviour that they know to ask if any assistance is needed, to let the customer know they are being watched.
Train them to know what to do in the event of a theft occurring.
Give your staff a reason to focus in on these issues, praise their observation skills and reward them if possible.
Make staff aware of any implications if they decide to use their position to take advantage of stealing of giving away products at reduced prices.
5. Beware of scams
Make certain that your employees are aware of any scams that you hear about, there are always new tricks that appear which are hard to keep on top of. Try and stay aware of these and keep your staff in the loop also. Millions are lost every year due to scam artists.
6. Use RF/RFID tags
RF (Radio Frequency) or RFID (Radio Frequency Identification) should be used in retail stores to combat theft. RF tags would be the more common used security tag used, but both set off security sensors if someone attempts to walk out of the shop with tags still attached to the merchandise.
RFID tags have chips embedded in them. These chips contain information about the product and allow you to track items using their stock control system. RFID enables merchants to locate items and ensure that products are in the right place, at the right time.
7. Run a Live-stock system.
Have a system in place which enables you to follow the movement of each item of stock at the click of a button. Having control over your stock from arrival to purchase will help eliminate discrepancies and allow them to be identified easily. The use of a system will allow this to run more smoothly.
8. Use employee sign-ins
For access to scanners when processing orders or deliveries provide a username and password for each employee individually. Use this system for access to the till EPOS also. This locked system will allow you to see who exactly was involved in each transaction whether front-of-shop or back.
9. Know what stock you have on hand
Your stock is your livelihood; it is essential you know exactly what stock you have on hand as there are so many deliveries and sales processed every day. Ensuring you carry out stocktakes as often as you need is essential. Have a read here for tips on how often you should conduct a stocktake.
10. Investigate discrepancies
When it arises that there has been a discrepancy it must be looked into! Examine which products are causing issues through stocktaking or analysing a specific department. If these are due to breakages ensure they are recorded and not being accounted for.
The final note here is to remember that everybody in your store is accountable for items missing, stolen and broken. Employees knowing there is an onus on them to have responsibility for any discrepancies that occur under their watch will always be more careful.
Sign up to our newsletter here for more tips on running your retail business.
Did you ever look at the price of an item and decide that ‘it’s crazy’ and ‘not worth that price!’? We all have, but in many circumstances we don’t take in account the work that has taken for it to get to the shelf in front of us and how all of these steps along the way add to the final price we pay.
Price is the amount given as payment by one party to another in exchange for goods/services; but what does it reflect? It all depends on what you hope to achieve from this product, how much benefit it will add to you/your life or your business. If it brings great value, you should be willing to pay for it.
Value is something that is regarded as having importance, benefit or of high esteem. These qualities are built up from a process of hard work and high underlying costs, explaining why high value is often reflected by high price.
Which is more important?
As the seller, the main questions you need to ask yourself are; does the price of the offering reflect the value the customer is receiving? Are you maintaining quality standards and constantly working to improve on what you are offering?
If you are answering these questions positively then you have no reason to question lowering your price. In certain circumstances a lower pricing structure is seen as a sign of low quality, so stick to your guns, if the service provided is of great value don’t lower the price unless it is totally necessary.
If you are the buyer of this product or service you need to stop and think about what is important to you. If you are buying a car or a house would you want the lowest price or the best quality?
I would take a stab at quality in the form of security and reliability. In everyday life however, only you are affected. Who does it affect in terms of business? Do you really want to reduce security and reliability in your business?
It goes without saying there will always be a cheaper option, but at what cost? It is usually at the cost of quality. In the vast majority of cases however, decisions are based on pricing in total isolation from any other criteria, especially quality. Unfortunately, allowing quality to slope in order to save money leads to a lot of rework and a higher cost as a result.
Stocktaking- Price Vs Value
Stocktaking is one area where electing a new service provider based solely on price means cutting corners on quality. These trade-offs can have painful effects on final results and a rework after this price based decision has been made can be a huge undertaking.
Our customers choose us because of the value we provide;
An ISO certified service
A premium stock counting team on site
A competent background teamhttp://eepurl.com/coWSlT
Accurate counting of stock- linking to customers EPOS
Updating customers EPOS to show live stock levels
Transparent valuations of stock
Easy rechecking for internal/external auditors
Detailed and Easy to read Reports
Gross profit analysis
An Itemised Count or an accurate evaluation of stock as required
To keep up to date with all our new blog posts, offers and news, why not sign up to our newsletter here..