How to maintain accurate stock is a major challenge for all retailers, regardless of their stock quantity. The number of stocks in your store must line up with the quantity you’ve recorded electronically to run your retail store efficiently. If not, poor stock accuracy can lead to stockouts and order fulfillment errors. You wouldn’t want to frustrate your customers because the product you promised them is now out of stock.
Stock accuracy is a crucial metric for retail businesses. If managed well, it can control stock quality by preventing stockout, shortages, and shrinkage, and also deliver a positive customer experience.
Stock accuracy measures the difference in stock between your electronic records and your physical stock. Usually, you compare the recorded stock number in your stock management system and what is actually available in your warehouse or store.
For example, if you record 100 items in your software but count only 80 units in your stockroom, your stock accuracy is 80%.
Let’s explore its benefits of accurate stock for your business:
Provide a better understanding of your business
Accurate stock status gives you a deeper knowledge of what and how many products you need on hand to meet customer demands. This helps you avoid overstocking or understocking. With the correct number of product availability, you can make sure your customers can place and receive orders accordingly. There will be less worry of shortages or hanging too many dead stocks on shelves.
Save time and money
Stock accuracy helps you minimize the time for counting and looking for products. When your stock is tracked correctly, including what has been ordered and what is left in stock, you will need less stock recount. A stock management software can update the stock in real time and shows you exactly what you currently have without checking it manually.
In addition, accurate stock informs you of the products that are selling well and not. Hence, you can decide to stop restocking the slow-selling items and push sales for the remaining. It helps you save valuable space in your store and reduce stock carrying costs. Moreover, knowing the best-selling products gives you insights into a further plan to stock these items.
Boost efficiency and productivity
Having accurate stock allows your employees to do their work easier and faster. Thanks to barcode scanners and a stock management system, they know exactly where to find a product in the warehouse. Your staff can scan the item’s barcode when picking it rather than having to write it down manually. This speeds up their job and makes the process more efficient. By reducing manual work, you also minimize human errors and allocate your personnel to focus on more important tasks.
Improve customer experience and loyalty
Stock accuracy can contribute to your customer satisfaction and loyalty. If you can display the correct product availability, customers won’t order out-of-stock items, for example. The order fulfillment process will go smoother as well with faster shipping. This leaves a good impression on customers and increases repeat purchases. On the contrary, inaccurate stock can lead to unfulfilled orders or missed sale opportunities if the customers don’t know you still have the product they want.
Bottom line
Accurate stock is crucial to streamlining your stock management process. It helps you prevent stockouts and overstocking, and reduce operational costs. A highly accurate stock will inform you with better demand forecasting and contribute to greater customer satisfaction.