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Inventory Adjustment

We’ll see a lot if we’ll just look. – We can watch, we can see, but WHAT will we see?

The buzz phrase in the garden center business this winter has become “inventory control”.  It has become trendy for garden centers to watch their inventory. They always should have. We will watch inventory come, we will watch it go but what will we see?

Although I have been unable to confirm it I have heard that Yogi Berra once said something to the effect; “You’ll see a lot if you look.” Anyone who has been in this business a while has already seen a lot. “Watching” the inventory is not going to be much help. While there is a lot to see, it is necessary to know what to look for. I don’t want to see this trend toward watching the inventory become a flavor-of-the month trendy thing we read about in the magazines and hear talks on for one year and then it is all over. The future of our industry depends on the financial health of our industry, and excessive inventory is killing many garden centers. This is not a new or temporary problem. Controlling inventory should not become a fad.

Inventory management is important every day that ends with ‘day’. Pause a moment until you get that. Inventory management is an EVERY-day thing for anyone who ever owns inventory. Ah, there lies the first and largest problem. In our Merchant Advantage program we teach the Retail Mantra, Merchant Principles, and other things retailers (and the people who supply them) should know about practical merchandise management. The Retail Mantra is; “Never buy anything you cannot sell (all of) before you have to pay for it.” You may feel that is a lofty goal and never achievable. While it is never achievable it is not lofty. It is a practical necessity. Retailers should not be in the business of watching their inventory. They should watch the inventory that belongs to other people to make sure it never becomes their inventory.

There are three things that cause inventory problems, and three solutions to go with them. (‘Stuff’ is lingo for inventory.)

  1. Owning the wrong stuff.
  2. Owning too much stuff.
  3. Wrong time for the stuff.

Merchant Advantage solutions:

  1. Buy the right stuff.
  2. Buy the right amount of stuff for your traffic.
  3. Buy stuff only for the selling period just ahead (witihin 30 days) and not further.

Many garden centers will return to over-buying as soon as the coast is clear and everyone tells them to buy something else. What will it be this time? Nevertheless, if the supply side can adjust accordingly it will be good for everybody to clear out some crap and clean up the stores.

Inventory Mangement Tip for Spring: The last re-order is the one that will kill you. Watch for the cliff coming. Look out at the transaction counts after Mothers Day. Spring is a short rope. Be careful.

If you like reading this type of Stuff from Sid, it is time to click here to Subscribe to Strategies Blog.

Leave a comment on how you plan to ‘watch the inventory’ this spring. And if you want to know more about Merchant Advantage subscribe to Strategies Blog for updates. Merchant Advantage will be offered this summer.


One Response

  1. I wish I had an inventory problem. It sure would be easier and quicker to fix than a debt load equal to gross sales for the year.

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