Stock inaccuracy could appear on the table of the retail manager in various forms. Unlike the structured environment of warehouses managed by Warehouse Management Systems (WMS), retail operations are far more complex, with multiple triggers for inaccuracy.
If time is limited, it’s crucial to monitor stock accuracy indicators such as negative stock balances or items without recorded sales. Ignoring these signals can lead to a negative impact on sales and, ultimately, the bottom line of your profit and loss (P&L) statement.Interestingly, I recall a time when we sold TV sets in our cash-and-carry stores—a department that generated good cash flow but came with unique stock management challenges. During my tenure as a floor manager overseeing Nonfood items, I identified a significant number of SKUs in the TV department that weren’t on the shelves. The issue? Damaged or malfunctioning units were being kept in the backroom, awaiting management decisions, instead of being addressed promptly.
The issue? Damaged or malfunctioning units were being kept in the backroom, awaiting management decisions, instead of being addressed promptly.
One category manager had an interesting approach to this issue. Before placing new orders, he would personally call all 48 Media departments across our stores to determine the availability of TV sets for customers. While this method ensured accurate stock information in the absence of reliable store inventory data, it was time-consuming and inefficient.
I’ve seen similar scenarios where damaged stock, particularly electronics, is left in the "red zone" for months. Such delays require thorough investigation to understand the root causes and identify ways to minimize financial losses for the store and company.
A simple but challenging rule I’ve tried to implement across various units is: “Write off products immediately upon recognizing they are unsellable.” This seemingly straightforward directive often encounters obstacles such as improper employee practices or outdated procedures that delegate write-off responsibilities solely to management.
A world where stock accuracy issues are nonexistent would significantly improve retail operations. Fortunately, advancements in AI signal a coming revolution in inventory management. These technologies promise to simplify processes, reduce the need for high employee qualifications, and lessen the effort required to maintain stock accuracy.
The results achieved by Akuret Solutions in current projects with retailers reinforce my optimism. It’s only a matter of time before most retailers benefit from precise stock metrics and a more efficient system.
All the best,
Paul
Paul Ryukhov
CEO/COO Ledo Supermarket
