2009 ORWM Outdoor Specialty Retailer Seminars

2009 ORWMOutdoor Specialty Retailer

SeminarsInventory Management:

The process Is More Important ThenThe TechnologyJanuary 23, 2009

Jay TownleyThe Gluskin Townley Group, LLC

The Gluskin Townley Group, LLC

Inventory Management: The process Is More Important Then The Technology

• Inventory Management is a collective term for eleven store operating functions

• Summary

• What I Want You To Do Today & Tomorrow

• Q&A


Inventory Management: The process Is More Important Then The Technology

Inventory Management = eleven storeoperating functions that are a part of theComplete Retail Process, #4 on the list of

fiveways to grow your business.• …the consistent steps your store follows

in providing an exceptional retail shopping experience, every time!

• Part of the Process…is having what your customers want, when they want it.


Eleven Store Operating Functions

1. Merchandise Assortment Planning

• Establish a planning process for selecting,stocking, displaying and marketing all of the Stock Keeping Units you sell…by season.

– Pricing policy– Inventory turn goals– Gross Margin Return On Inventory

GMROI



2. Sales forecasting at the category and SKU levels• Your merchandise assortment plan will

requiresales forecasts, as does your annual business-financial plan.

– Units and Dollars• Get your suppliers, managers and staff and

past sales history involved in the forecasting process



3. Open to buy, or OTB Analysis and Management • Available with some POS systems• Consulting services available…

category management• Never re-order a SKU that isn’t selling

at retail!• SROR = 29% of Retailers have OTB



4. Purchasing and generating and issuing purchase orders• Documents the terms and conditions• Available with some POS Systems

– SROR = 82% of stores have POS Systemsand 24% are booking orders electronically

• Integral part of OTB, cash-flow & AP• Go to a stationery store and purchase

manual forms!



5. Use of scanning technology from door to

door• SROR = 82% of stores have POS

systems and 24% are booking orders electronically

• Scan in at receiving, and Scan out at point-of-sale.

• RF technology



6. Regular and consistent education of staff to

ensure complete working knowledge of the

store POS system• Teach your staff how it works• Educate your staff about what your POS

system is capable of doing and what information and metrics it can generate

• POS vendor support



7. Retail process that assures consistent staff use of every aspect of the store POS system

• Teach you staff how you want them to use the system = Customer information

• Your POS system becomes a very powerful part of your stores complete operating process…when staff is educated and trained in all the modules and the system is fully utilized



8. Retail process that specifies what metrics will

be tracked and regularly generated by the

store systems…weekly!• What are the Critical Numbers to your

business– Sales, Operating Margin, Total Expenses,

Realized GM by categories and Inventory, Inventory turns & GMROI…Net Operating Profit



9. Store operating policies and procedures that

document and fully support the inventory management process• Store Operations Manual…your road map

to growth!• Don’t keep this stuff in your head…• The difference between not growing and

growing…could be simply writing it down!



10. Store management that consistently and

uniformly supervises, guides and helps staff

adhere to store operating policies and procedures• In other-words, lead by example…by

adhering to your own operating policies and procedures

• What, Why and How



11. Store management that consistently educates the staff in the store retail process, including inventory management

• Develop an annual staff training and education plan that goes beyond rep clinics on how to sell stuff

• Staff buy-in and support for your store retail process is critical to success and growth


SUMMARY

At the end of the day…it’s not the computers orsoftware, or technology, it is your documentedstore operating process, consistentmanagement leadership and ongoing staffeducation that makes possible more profitableInventory Management that will help yourbusiness grow!


Inventory Management: The Process Is More Important Then The Technology!

What I Want You To Do Today & Tomorrow• Write down your thoughts and ideas for

developing or improving your merchandise assortment planning.

• Include what you are going to do to develop and improve your sales forecasting.

• If you don’t already use OTB, write down what you plan to do to implement OTB this quarter.



What I Want You To Do Today & Tomorrow

• If you are not using a formal purchasing system – write down your thoughts on establishing one.

• If you are using door-to-door scanning, write down your ideas for improvements…and if your not, your thoughts on implementation.



What I Want You To Do Today & Tomorrow• If you don’t have a Store Operating

Manual, write down your thoughts and ideas for developing one this quarter.

• Write down your thoughts and ideas for improving your staff education plan and program…and if you don’t have one, what your thoughts are about establishing one.




• Write down your ideas for leading your store inventory management process, and making your leadership and that of your managers consistent throughout the year!

– Store Operating Manual– Staff education plan and program


• When you have 15-20 minutes at your computer, take the OIA Outdoor Specialty Retail Survive Or Thrive Assessment Survey by visiting www.outdoorindustry.org



Q & A

Thank You!

Jay TownleyPartner

The Gluskin Townley Group, [email protected]