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More Than 20 Tips That Move Inventory
Easy promotions that move inventory
What merchant has not heard the saying that 80 percent of your business comes from 20 percent of your customers? The saying has also been extended to report that 80 percent of your sales comes from 20 percent of your items. Unless you have a very detailed data base in your computer, you probably can't determine who the "20 percent" customers are. And while the data base can tell you which of the products on your shelf are a part of that "20 percent" group, you know that most of the rest of your inventory is necessary to make your store profitable.
There is, however, a group of items that you most definitely would like to get rid of. It may be items that are becoming obsolete as new technology is developed, items that are no longer fashionable, or items that just don't sell in your market.
Simply marking down the merchandise, looking for that price that will attract a customer is not necessarily the solution to eliminating merchandise that does not move. In providing ideas that will assist you in keeping your shelves stocked with the appropriate items, we can divide the ideas into two groups. The first group contains ideas that will assist you in generate more sales and increase your turns, while the second group contains ideas that will assist you turning these frozen dollars into liquid assets.
To create this list of proven ideas that will assist you in eliminating old stock, we checked with Mr. Jack Rice, and Mr. Bob Aiken. These are two gentlemen who have spent many years, both as retailers and consultants. Knowing that three heads are better than one, here are our 18 ideas to move inventory.
1. Utilize your end caps - Build your best displays on these counters and change them frequently. Sometimes, you can simply move an end cap from one side of the store to the other to give the appearance of a new end cap. A well designed end cap should move as much merchandise as half of one side of the aisle behind it.
2. Constantly remerchandise your store - You don't have to necessarily dismantle the entire display, but you should always be checking your catalogs to find items that have been discontinued as well as new items that have been added to the selection.
3. Create a min/max system - Sometimes we develop old inventory because we have excessive inventory. By developing a min/max inventory control system you will be sure to have inventory on hand for the anticipated sales, but you will also be certain to not have excessive inventory.
assignment - Assign each of your employees to be in charge of a department
or section of your store. Their instructions should include details
of watching for inventory that is showing signs of age. This way you
can move out the inventory quicker and recover a larger portion of
6. Know when to say when - If you have found a new product category that is very popular, (think gift shops that sold "Beanie Babies") remember that these categories will get cold just as fast as they became hot. When you decide to carry these items, give a second thought before you place each reorder. The cost of getting rid of inventory could take away all the profits you have made to date.
7. Spotlight tables - These can be even more valuable than end caps. Place a rack or table of merchandise near your front door. Sometimes the merchandise will have a sale price and other times it will be a display to introduce new items. This display should be changed every 3 days.
8. Bag stuffers - Every customer that shops in your store can be a repeat customer when you place a flyer in their bag as they make a purchase. The flyer can announce a clearance sale, special price for returning customers, or an upcoming major sale.
9. Parking lot coupons - Print a coupon that you can have your employees put on the windshields of cars in your parking lot. You can even minimize this expense by inviting another business to place their advertising on the back side of the coupon.
10. Hint cards - Create fold-over business cards that have the following message inside: "While I was shopping in (your store) the other day, I saw a (name the item) which sold for (price) that I really liked. (Name) was the sales person that was helping me". Distribute these hint cards to your employees to hand out and to place around the store.
11. Preview night sale - The evening before your sales flyer is distributed or your newspaper ad appears, have a private sale to which you invite customers by way of a newsletter that you mail to them.
12. Holiday sale - Have a sale offering 15% off any item that has red on it for the 3 days before Valentines Day, green items before St. Patrick's Day, orange items before Halloween, and any other color theme sale that you can think of.
13. Sale merchandise placement - When you advertise an item, don't place it in the front of the store. Instead, place a sign at the front of the store announcing the item and the sale price. Place the sale item in the rear of the appropriate department and merchandise additional items from the front to the rear of the store.
14. Receipt coupons - Change the traditional thank you message on your receipt to be a coupon. A simple 50 cents off of your next $10 purchase is a great way to get the customer to retain the receipts. And if your business name, address, phone, and store hours are on the receipt, the customer will see this information every time they open their wallet.
15. Store decorations - Always decorate your store. Crepe paper decorations, streamers, and appropriate signs are all that is needed to give your store the appearance of excitement. Change the decorations at least every other month.
16. Manufacturers or wholesalers representatives - Invite these people to be in your store on weekends as well as when you are advertising. These unpaid sales people are professionals that can assist your customers in making a purchase by being the expert information source.
17. Insult cards - There are always a few customers that are price conscious. On the left side of a 5 x 7 card place a copy of the competitor's ad showing the item and sale price. On the right side of the card show that your price is the same as your competitor. This helps to quickly eliminate price comparisons and gives the customer a level of price comfort in your store.
18. End cap contests - Employees love contests, especially if there is a prize involved. Assign each employee at least one end cap and then allow them to merchandise the display. You can award prizes based upon sales or most attractive display. As was once said about any business, show me a business that does not have any old merchandise, and I will show you a business that just opened last month. For those unfortunate situations, where despite your best efforts you find that you have undesirable merchandise, here are 5 ideas for moving this merchandise out the door.
1. Have a "Dutch auction" - Utilizing a table or end cap, retag the merchandise to the current full retail price. Place a red dot in the center of each price tag so that you will be able to denote the items that are to be a part of the auction. The sign on the display should have a large calendar that will show that the first week of the sale, all items are 10% off their regular price. The second week, the prices will be 20% off, and so on until all items are gone.
2. PM Merchandise - Determine a sale price for each item then create a chart listing all of the items. The list should be kept at your check out counter. When an employee sells one of the items, you pay them a predetermined bonus that should be in the range of 10% of the sale price.
3. Create a grab box sale. Put several of the items in a cardboard box. The box should have the top cut off so that customers can see the contents. If you cover the top with a plastic wrap, you can provide a feeling of mystery in your grab box sale. Calculate the total cost of the goods within the box, and from that you can determine how much of the cost you think you can recover with a grab box sale price.
4. Use the more attractive items as door prizes for contests that you will have in your store. You can also use the items as the products that you donate to a charitable group for their door prize.
5. Give the item to charity. Determine your cost and retail for the items, and then ask your accountant to give you guidelines as to whether you will gain more from giving away the items or utilizing one of the other clearance sale ideas to free up these inventory dollars.
With these two lists, you will find several ideas that will work within your store so that you can keep your inventory dollars moving. Just make sure that you do not duplicate the old story that told of the store owner that would mark something up by the same amount that he would mark something down. He was sure that the idea was working until he found the jogging shoes on the shelf with a price tag of $23,000.
Profits Plus Solutions, Inc.