This module addresses the needs of small retailers to balance their financial commitments to the merchandise inventory for a business with increased sales. The outcome anticipated is a more thorough understanding of the need for inventory planning in a way that will maximize the return on the inventory investments (i.e., gross margin return on investments [GMROI]). The participants will need to be familiar with stock/sales ratio planning and with inventory turnover rates. If these concepts are new the module can be adjusted to allow some time to cover these topics.​

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We will begin with a discussion of the strategies for planning inventory investment. Examples of good inventory planning will guide the discussion. The most vital asset to any small business is its inventory. Accordingly, effective inventory management topics to be covered could include how to manage costs and space allocation, measure shrinkage and improve the customer shopping experience.​

 

We will cover model stocks, basic stocks and weekly sales as a means to understand the importance of planning regular inventory replenishment. Inventory tracking software (i.e., POS systems) options for small retailers could also be presented and discussed. To maintain both even merchandise flow and sales throughout a season the timing of receipt of goods as a strategy for success will be shared. This may lead to some discussion of vendor negotiations.​

• Allocating inventory focuses on helping the business owner formalize their inventory classifications and refine these for future business growth. ​

• Analysis of sales by classification will guide the allocation of inventory.