Owning and operating a retail business presents some unique challenges. You need to have product available to your customers in order to generate a profit and ensure that you are providing good customer service.
Determining how much product you should keep stocked on your shelves at any given time is difficult. Many companies struggle with balancing inventory levels, and this struggle can impact your company's bottom line. Invest in demand planning software if you want to eliminate inventory-related headaches in the future.
1. Strategic Pricing
A demand planning software program gives you greater control over the pricing of items within your inventory. You are able to more accurately predict sales volume for the future, which allows you to purchase your stock when prices are low.
Pricing strategies can then be developed that will maximize profitability rather than merely cover inventory costs. Strategic pricing will make your company more competitive within the marketplace, helping you to attract new customers and grow your business over time.
2. Increased Inventory Turns
It's important to keep fresh inventory on your retail store's shelves at all times. Customers don't want to purchase old product or product that has been sitting on the shelf for a number of weeks. With a demand planning software program, you can effectively increase the number of inventory turns your company completes each year.
The software program gives you the ability to predict sales volume more accurately so that you don't have inventory overages. You can optimize inventory levels to ensure that each product within your inventory moves from receiving to final sale in an acceptable amount of time.
3. Reduced Supply Costs
Profit margins can be slim for many retail businesses. This means that you must work to eliminate all excess spending from your budget if you want your company to remain profitable in the future.
Inventory overages can be costly. Not only do you spend money on the purchase of too many products (which ties up capital), but you may end up losing a significant amount of money if you have to donate or throw out inventory that doesn't sell.
Demand planning software can factor in market fluctuations and past purchase history to help predict the number of sales that you will make in the future. This information allows you to invest in just enough inventory to meet your needs.
Demand planning software is a valuable tool that can help you improve product quality and reduce costs in the future. Reach out to a company such as Enhanced Retail Solutions to learn more.