The good news is that these problems can be avoided.
A proper approach to organizing your inventory can help you boost your sales and make it easier to identify which products are in high demand and need to be restocked and which are not selling at full price and need to be liquidated.
Find out below the principles of stock classification.
1. Organize your inventory into unique categories
What differentiates one product from another?
Let’s say you’re a fashion and clothing retailer. Rather than categorizing japan whatsapp number all your t-shirts into one generic category like “t-shirts,” it’s better to categorize them based on their unique characteristics, such as:
Size
Color
Cut
Fabric
Brand
The Basics of Organizing Your Inventory: How to Manage Your Stock
Why use unique categories for your inventory?
Categorizing similar products based on their unique characteristics in your POS system allows you to accurately identify the types of t-shirts that sell well. You can then refine your inventory classification using an ABC-style classification (more on this later).
Unique categories provide valuable support when it comes to inventory replenishment. Instead of having to analyze countless data points, you can easily filter your sales reports and see exactly which types of t-shirts are selling best. What sizes, colors, cuts, and brands sold best? Armed with this valuable information, you can maximize the profitability of your next replenishment order.
Idea ?
You can create matrices for products with different sizes, colors, cuts, and fabrics. Click here to learn how to create product matrices in the Lightspeed Retail app .
2. Classify your stocks according to their profitability
In addition to creating unique categories to organize your inventory, you may also want to consider using ABC inventory classification, which indicates that not all of your inventory items have the same value.
According to the ABC ranking , you should group products according to their estimated importance to your business. For most businesses, this ranking looks like this:
The Basics of Organizing Your Inventory: How to Manage Your Stock
High Value Inventory Items
Medium Value Inventory
Items Low Value Inventory Items
Stock A: Represents approximately 20% of the items in your inventory and produces 80% of your annual sales volume.