4 Tools of Promotion
The 4 Ps of marketing are product, price, place and promotion. All four of these elements combine to make a successful marketing strategy. Promotion looks to communicate the company’s message across to the consumer. The four main tools of promotion are advertising, sales promotion, public relation and direct marketing. Advertising Advertising is defined as any […]
Customer Loyalty and Satisfaction
Most of the organizations have murkiness in considering customer loyalty and satisfaction. They feel that both are same and a satisfied customer is always loyal to them. But this is not true as the customer can be delightfully satisfied but he may be or may not be loyal. This is because satisfaction an emotional and […]
Classification of Retail Formats, Key Features, Advantages and Disadvantages
Retail Formats can be classified into the following categories: Store Based: Store based formats can be further classified into two formats based on the basis of Ownership or Merchandise offered. Non Store Based Classification: Non Store retail organizations focus on establishing direct contact with the consumer. This may be both personal (direct personal selling) and […]
Brand Equity & Customer Equity
Brand Equity is defined as value and strength of the Brand that decides its worth whereas Customer Equity is defined in terms of lifetime values of all customers. Brand Equity and Customer Equity have two things in common- Both stress on significance of customer loyalty to the brand. Both stress upon the face that value […]
A Comparison between Shareholder Ownership and Control
In previous articles, we discussed the roles and responsibilities of the shareholders. In this article, we look at the distinction between shareholder ownership and control and illuminate how this comparison plays out in the corporate world. To start with, many public limited companies have a large body of shareholders who have invested in the company […]
Inventory refers to the goods stocked for future use. Every retail chain has its own warehouse to stock the merchandise to be used when the existing stock replenishes.
Inventory management refers to the storage of products to be used at the time of crisis.
The retailer keeps a track of the stocked goods and makes sure there is surplus inventory to avoid being “out of stock”. Such a process is called as inventory management.
Gone are the days when customers had limited options for shopping. In the current scenario, if a customer does not find the desired merchandise at one retail shop, he has a second brand to rely on. A retailer can’t afford to loose even a single customer.
It is really important for the retailer to retain their existing customers as well as attract potential buyers. The retailer must ensure that every customer leaves his store with a smile. Unavailability of merchandise, empty shelves leave a negative impression on the customers and they are reluctant to visit the store in near future. Inventory management prevents such a situation.
One must understand that the products need some time to reach the store from the supplier’s unit. The retailer must have sufficient stock to offer to the customers during the “lead time”.
Managing inventory also helps the retailer during situations beyond control like transport strikes, curfews etc. The retailer has ample stock as a result of judicious inventory management even at the time of crisis.
Every product available at the store has a unique code. This code which helps in the identification and tracking of the products at the retail store is called as stock keeping unit or SKU.
The retailer feeds each and every SKU in the master computer and can easily track the product in the stock just by entering the SKU Number.
Assigning a unique code to the products avoids unnecessary searching.
Example
Let us take the example of “Numero Uno” which stocks denims, shirts, T Shirts and targets both men as well as women.
SKU for Shirts
Where:
NU stands for Numero Uno
M - Men
40 - Collar Size
FL - Full Sleeves
W - White (Colour of the shirt)
In the same way B in the second example would stand for Blue
Simply typing NU – M-40-FL-W would let the retailer know whether the particular merchandise is available with him or not.
The stock which is never been sold by the retailer and now not even being manufactured comprises the new old stock. Such products do not have takers and may not be produced anymore.
Stock out refers to a situation when the retailer fails to fulfill the customer’s requirement due to lack of merchandise. The merchandise is not available in the current inventory and thus the customer has to return home empty handed.
Employees working at the store might get tempted to steal the merchandise.
Let us go through some tips which help to prevent loss of inventory:
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Challenges to the Retail Sector (As per Michael Porter s Five Forces Model)
February 12, 2025
