Written by our very own James Tullai, One Step Retail Solutions Implementation Specialist
The perfect inventory, huh? You are probably thinking this isn’t possible or it may only be possible with low volume stores. Conventional wisdom would say with higher volume the greater the chance of something going wrong. However, mistakes can happen in any store. The secret is to catch them as quickly as possible. You don’t want to wait until you are in the middle of a Physical Inventory. At that point, it is too late fix them properly. I don’t know about you but I certainly don’t have time to run around fixing mistakes while counting inventory. These are some simple steps you can take between store wide physical inventories to help keep your inventory as accurate as it can be.
- Print weekly negative on hand reports Have each store print a negative on hand report each week. Look at all activity for those items such as sales, store-to-store transfers or receiving. Always fix the problem by correcting the action that created the negative quantity. Avoid creating adjustment memos as a quick fix. You will only be kicking the can down the street. If you are negative on one item, you could be over on another and not know it until the next physical inventory. This will show up as shrinkage on the physical inventory when it really isn’t.
- Perform cycle counts each week on high ticket items. Pick a department, vendor or collection each week. Let’s say Mondays. Have managers print an on hand report filtering by those items only. The list should not be long. Have the associates verify the counts. If they are spending more than 20-30 min counting it and checking discrepancies, the list is too large. Discrepancies that cannot be resolved should be adjusted out of the inventory by management.
- All inventory items tagged with barcode. If an item is not properly tagged, Sales associates will often times manually key in the wrong SKU or select a similar SKU of size or color instead of the correct one. Avoid hand written tags. All stores should have a tag printer. If you don’t, get one. It’s well worth the investment.
- Properly train employees on your POS system. I’ve seen employees get creative if they don’t know what they are doing and make mistakes without realizing it.
- Implement strong security policies to prevent mistakes or even theft from happening. Avoid sharing Admin/Sysadmin passwords. This password should be changed routinely. This really more of a loss prevention issue but it does have an effect on an accurate inventory. For example: Require manager override for all returns. Or restrict who can create RTV’s.
- Keep a well-organized back room.
Merchandise is less likely to get misplaced or miscounted during the next physical inventory.