Magazine Article | December 16, 2008

Optimize Inventory Tracking

Source: Innovative Retail Technologies

This retailer saves 5 hours a week in manual inventory tracking processes due to its new POS installation.

Integrated Solutions For Retailers, January 2009

Peggie Flierl has owned Wild About Birds, a backyard bird feeding supply, garden décor, and gift shop located in Milford, OH, since 1998. Over the years, the retailer's gift selection (e.g. relaxation CDs, candles, puzzles) has grown to occupy 50% of the store's square footage. However, gift sales do not account for a large part of the retailer's revenue, though Flierl believes there is potential based on anecdotal customer interest. "Our goal is to ensure gift sales increase because they have a bigger profit margin than things like bird seed," explains Flierl.

For the past ten years, Flierl spent five hours a week manually tracking inventory, as her store lacked an inventory tracking POS solution. "My biggest challenge is controlling inventory," explains Flierl. "This was the main reason I was interested in purchasing a POS system. Prior to that, I managed inventory by walking around the store with a pad and pencil." In addition, the retailer had used an old-fashioned cash register to ring up sales. The register calculated inventory by grouping items together. For instance, at the end of any day, week, or month, Flierl determined that 500 bags of seed were sold, but she had no idea what kind or brand of seed it was. Therefore, Flierl upgraded to a cash register with a price lookup (PLU) system. Employees assigned PLU numbers to the products, and they keyed PLUs into the cash register. The cash register tracked the amount of products sold via the PLUs, and Flierl could print statistics on the register, which enumerated the amount of each product sold. However, once information was printed, there was no history of it. It did not help with inventory other than to tell how much of a given product was sold.

As the amount of gift products grew, so did the amount of inventory that had to be tracked each month. Flierl had no way of knowing how many items were in stock, as she guessed when it was time to reorder. These guesses would leave her with more products than she could sell. Flierl felt that in order to sell more gift items, she would have to track inventory more efficiently by incorporating some kind of electronic inventory tracking system.

In January 2008, Flierl received a trial of GiftLogic POS software in the mail. "I've wanted to purchase a POS system for the last six years, but I was scared off by other vendors because I did not know what hardware to purchase," says Flierl. "The GiftLogic POS solution provided all the hardware we needed — a PC, a cash drawer, a printer, and a bar code scanner." The retailer purchased two PCs, one that serves as the cash register and one for tracking inventory and reporting in the back office.

Install Your Own POS System
The vendor shipped the entire POS solution to the store. Flierl installed the POS system on her own. "Installing their POS system is as simple as installing a PC," says Flierl. "Installation took a few hours, and I simply followed the written directions and attached everything to USB ports. I purchased 24/7 support, so I called them when I had questions or concerns." Every item in the store has a bar code, which the retailer had to associate to a number in the POS system. Because the retailer previously created the PLU system, each product was already numbered and listed in a database. Flierl uploaded the database to GiftLogic, which eliminated the need to reassign new numbers.

The vendor conducted employee training remotely as well. Flierl purchased 10 hours of training, which she participated in over the phone. The vendor signed on to her POS system remotely and explained the system screen by screen or function by function.

Since implementing the vendor's POS system, the retailer has been able to manage both inventory and buying. Flierl saves five hours each week in manual inventory tracking. "Based on the POS system's reports, I know exactly what to buy and when," says Flierl. "The reports tell me what products I'm low on and when to reorder." Order accuracy is near 100% because it is almost impossible for employees to make mistakes (e.g. putting in a cash transaction when it was really a credit transaction). 

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