Inventory Control Programs: Is the Internet the Future?
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Inventory Control Programs: Is the Internet the Future?

The greatest task in a retail store is inventory management.

Over time, the systems that stores use for inventory control have become increasingly elaborate. In fact, each time you check out from a store's register, the items that the cashier scans the barcodes of are transmitted to the transaction record and then deleted from the store's inventory once the transaction is completed. This is the final step in the process of inventory control, but from another point of view, it's actually the first step. From a customer's point of view, the idea is relatively simple: does the store in question have what they want or not? From the company's point of view, matching a customer's needs with an item is the entire question of profitability for sales. All the customer really wants to know is whether or not the store has what they want and if they can get it to them as fast as they want.

Retail and grocery stores did not always consist of a shopping experience. In the first half of the 20th century, customers told the grocer what they wanted, and he went back and found it for them in inventory. As corporations began to seek larger market share, however, they found that advertisement was key, and that it was also important to continue the message inside the store. To that end, companies came up with the current display style shopping experience, which allows customers to peruse merchandise and find what they are looking for.

Another aspect of inventory control is dead merchandise. If an item does not sell, it is taking up space, air conditioning, light, and employee time, and in essence costing the company money. Have you ever noticed that the items at a store you frequently shop at are moved slightly almost constantly? The endcaps and displays of stores are designed to be flashy displays of good deals and popular items; they are also designed to sell well.

Did you know that every item has a specific location within a store? The planogram is a device designed to inform employee about exactly where an item is supposed to be placed in the store: what aisle, shelf, and position on the shelf or other location. The planograms are very elaborate computer simulations and can get extremely specific, such as enumerating the exact shelf height to use for the item. By stocking items properly and making sure that all merchandise is presented as attractively as possible, store managers can ensure that their merchandise sells as rapidly as possible.

There are weaknesses to the store design, however. Stock can run out, and customers do not always get told the correct answer of whether or not an item is still on the shelves. A recent store innovation at WalMart may hold the key to the future of shopping: the Site to Store program allows shoppers to order products online (often for cheaper prices) and have them shipped to the store in 7-10 days at no extra cost for shipping. Using this system, individuals can browse the online store and ensure that their item is waiting for them when and where they need it. The system is currently underutilized, but rival competition may make this idea the wave of the future.

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Comments (4)

This is good to know. I'm just irritated by stores always changing the location of goods. Maybe they want more exposure for their items but it backfires as I dislike going to those stores.

Ron S.

Great article - yes, online inventory management is the future. We just launched an online app for inventory, pick-and-pack, and shipping called the Yobiz eRetail IPS application. Check it out at http://eretail.yobiz.com/ips

Ron S.

Great article. Yes, online inventory management is indeed the future. We just launched a new online inventory management app called Yobiz eRetail IPS that handles inventory, pick-and-pack, and shipping. Check it out at http://eretail.yobiz.com/ips and let us know what you think!

Walker Thompson

Based on the title of this post, I'd say yes! Cross-store inventory is really one capable through the internet, especially one integrated into the POS (point of sale). My company works with hundreds of restaurants to manage their inventory challenges. We have demonstrable proof that we have helped saved on food costs and more using one of our variance reports. But I digress... Your blog post is spot on. Inventory management REQUIRES the internet.

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