Unreliable Inventory Quantities
- Sales Information – Real-time knowledge of what items your customers are buying
- Time Savings – Inventory updates are immediate; there’s no manual tabulation involved.
- Accuracy – Since the updates are done by computer, clerical errors are eliminated.
- Data Collection – Key business data can easily be gathered and reported on.
- Cost Savings – Optimize inventory by minimizing overstock and reducing stock outs.
- Consistency – Define best practices electronically and monitor compliance.
Most thrift stores have unreliable donated inventory quantities. When asked why the inventory quantities are unreliable, the most common answer is that it takes too much effort to make them accurate. In addition, the donated items have zero cost, so why expend the effort.
This is an indication that their retail solution doesn’t match their needs. Computers are supposed to make things easier not harder. Why should businesses invest so much money in a retail solution if it cannot produce accurate inventory quantities?
It turns out that proper inventory management is difficult. It requires disciplined and meticulous workers to keep data accurate. Small errors creep in and accumulate over time to distort the inventory. That’s why physical inventory counts are necessary.
There are 3 ways items get removed from inventory:
- Theft (or spoilage)
- Pull (donated items that don’t sell)
All sales are recorded automatically. Thefts and Pulls are not. When users complain that inventory quantities are hard to maintain, they are saying that it is hard to tabulate the Thefts and Pulls.
No retail solution can determine how many items were lost due to theft without physical counting. As for pulled items, many retail solutions require the user to scan out pulled items (which is similar to physical counting). This is tedious and error prone. What happens if the pulled item doesn’t have a tag? Also, small errors will accumulate and after a few months the inventory quantities are inaccurate and will stay inaccurate unless a physical count is done.