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Item Level Inventory: Overcoming Challenges

Item Level Inventory: Overcoming Challenges

It is a known fact that many independent stores and even some small chain stores do not maintain adequate control of their inventory. As a C-store owner, you know maintaining adequate control of your inventory is crucial to your margins. Maintaining an accurate inventory count is vital. Managing item-level inventory? Even better.

 

Managing inventory at the item level entails tagging and tracking individual products as opposed to cases or pallets. This allows a hyper-accurate count of your inventory, and enables you to better track your stock levels, sales, as well as make better projections. Still, many C-stores don’t bother with item level inventory for one key reason: time.  

 

Time is crucial. In the C-store business, you know this better than most. On any given day, a C-Store owner and/or manager is dealing with countless numbers of tasks such as:

  • Assisting customers
  • Creating vendor PO's or receiving deliveries
  • Paying service providers like electricity and landscaping
  • Balancing their books
  • Reconciling their bank account
  • Keeping up with permitting and license renewals
  • Doing payroll
  • Managing their retail prices
  • Managing fuel inventory and weighed costs
  • Generating end of month CPA reports
  • Calculating P&L

 

Unlike large corporations, many independent stores and small chains don't have an entire army to take care of these daily tasks so either the manager and/or the owner are forced to do this. To make their lives easier, many companies have built home grown inventory systems using Excel or MS Access databases, or use the classic paper and pencil. This can be time consuming and lead to errors.

 

Thankfully, with CStorePro, tracking your C-store’s inventory has never been easier.

 

The Challenges of Inventory Management

In many stores, the employees close their shift by hand, then managers enter the data into Excel or their home grown system. Owners will then verify the entries the manager made and generate their monthly P&L and CPA reports.

 

To create purchase orders, many managers and owners rely on their vendors to tell them what they need. Creating the purchase orders, or verifying vendor recommended purchases, can be time consuming. Along with other business matters taking place on any given day, the managers will sometimes make this a lower priority. Doing this can cause many stores to order a surplus of items that are not selling and order less items that are.

 

When purchases are received, owners are left to rely on managers to verify the deliveries and update the prices in their point of sale (POS) system when costs have increased. Then, they have to train their employees on the new prices if they are not scanning.

 

With this method, there is no way for owners to know if the cashiers are selling the item at the right price or not. In many cases, if the price book is not managed accurately, businesses are selling many items below cost without even knowing it, causing their profits to decline over time.

 

These are just a few examples of daily issues/tasks faced by owners or managers that prevent them from managing inventory at the item level. Of course, it doesn’t have to be this way in 2017.

 

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Back Office Management Software

There are back office management software solutions in the market that can help minimize or even eliminate many of these tasks.

If you are one of these owners that truly want to implement back office management software, but do not have the time, follow these 5 simple steps with CStorePro that will help manage all these things from one central, cloud-based application:

  1. Sign up for CStorePro and start using the Lottery Module (Save 15-20 minutes per day)
  2. Implement daily reports in your CStorePro account (Save 30-45 minutes per day).
  3. Implement fuel management in your CStorePro account (Save 15-30 minutes per day).
  4. Implement scanning at the store (save 45-60 minutes per day).
  5. Implement purchasing and inventory management in your CStorePro account

 

Once you have executed these 5 steps, you can use your newfound time to implement item level inventory management in a systematic way.

 

Item Level Inventory Management

 

If you are tackling item level inventory for the first time, I highly recommend starting with a few select items to learn from your mistakes before branching out to the entire store. Many customers like to start with one department such as cigarettes because it's a big seller, with higher possibility of theft and low margins.

 

To start managing item level inventory for cigarettes, do the following:

  1.  Make sure you are scanning all the items that you are selling so that CStorePro can know what’s being sold. Click here to learn how to add items to your register for scanning.
  2. Link items such as cigarette packs and cartons so that when you sell 1 pack, the system will subtract 0.1 cartons (10 packs in a carton) from your inventory. Likewise, when you sell 1 carton, the system will subtract 10 packs from you inventory. 
  3. Enter deliveries for all purchases so the system can know what is coming into the store. 
  4. Review your inventory reports and occasionally do inventory audits to account for shrinkage.

 

To make receiving deliveries easy, many big national and regional vendors like Grocery Supply, CoreMark, HT Hackney, or McLane have EDI formats that allow you to electronically upload your purchases so you don't have to manually enter in each delivery. Fintech, a company that handles payments for beer vendors also provides EDI files for all your beer vendors. More about Fintech for CStorePro customers here.

 

If you’re ready to take the next step towards controlling your inventory with a back office management software, please don't hesitate to contact us and Schedule a Free Demo.

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