The Common Inventory Problem That’s Killing Your Bottom Line and ROI



Your inventory is slow-moving. Products are getting carried over year-to-year. As a result, inventory levels are consistently rising.  And your bottom line is suffering as a result.

Why is this happening? It’s likely you are struggling with a common retail inventory problem – one that can be solved after you’ve identified it.

Put simply: your store has become disconnected from customer needs.

Let’s look at a few signs that you struggle with this common inventory problem…

Salespeople are selling you merchandise.


Let’s say a sales rep calls you to say they are running a promotion for 15% off of a particular product. You think, “Great! 15% off. I can make more money from the sale of this product.” But who is this product for? Is it a good product? Is it a desired product?

When a manufacturer’s sales reps are guiding your store’s purchasing decisions instead of customer need, you run into problems.

You don’t know who your current customers are.

Do you know exactly how far your customers are willing to travel to get to your store? Their age, income level, and gender?

Often retail stores and chains only do this kind of investigation when they launch their business, but it’s important to stay on top of changes. This way, you can ensure you’re not working on incorrect assumptions.

This information is easier than ever to gather with the help of technology and an effective retail store marketing plan, and it can help ensure that your merchandising matches your target audience’s needs.

You allow yourself to go down a slippery slope.

It starts with ordering a product no one wants to buy. So you cut the price a little to try to entice shoppers. Few of them take advantage of it… so you cut the price again two weeks later.

This retail store marketing strategy sets you up for long-term troubles. In retail, a good mantra is: the first loss is the best loss. Always cut the price substantially when you liquidate. Otherwise your customers will recognize that the price will drop more later – and they won’t jump at deals when you offer them.

Your entire team isn’t aligned.

In some cases, part of your team may be very well aware of customer needs. But the problem arises when they aren’t communicating with other parts of the organization. Everyone – from merchandising to sales staff to internet retail store marketing – needs to be working together towards common goals.

For example, if you are running a promotion on a particular product online, sales staff should be trained on how to sell that item when someone comes in looking for it – not guiding them to another item.

The goal is for everyone to be a team player – and to be informed about who the customer is and what the evolving store goals are.

You buy what was popular last year – or even last month.

This is a common problem in established businesses, particularly those that have been around for 10 years or more. They aren’t used to the pace at which things change today due to technology.

You are marketing to an audience that’s constantly evolving. You can’t look to the past for merchandising decisions. You have to look to the future.

For example, what are the current search trends? For many products, people research well in advance before actually making a purchase.

Is this common inventory problem killing your bottom line?

Get help from Location Traffic. We’ll implement retail store marketing strategies that achieve exponential – not incremental – growth through reconnecting with customers and their needs.

These are warning signs we often see. We know how to help.
Posted: 5/23/2016 10:54:46 AM by Shep Morrow