Inventory Selection and Your POS Software
There are many components in evaluating your inventory selection, but if you narrow in on just three, it will help you make wise decisions and not take up all your time. Good POS Software gives you these three things easily at the inception of the sale and runs them seamlessly to your back-end analytics. These three things are stock turn rate, sell through and margins. If you have a high sell through percentage and maintain a good margin, you are selling most of your inventory in a given period and keeping your profits up, but a high sell through with a low margin means you are probably devaluing your inventory by marking down or discounting to get rid of it. No profits here!
Most retailers that are having a problem achieving adequate profits usually have a poor stock turn rate due to lack of good open to buy planning, resulting in overstocks, excessive markdowns and low margins. You can see how these three components individually will not help you increase your bottom line, but when used together with the correct ratios, success follows. Good POS Software with a robust retail stock ledger and built in open to buy planning will give you these figures without a lot of work and hassles. Don’t buy a glorified cigar box when you can have POS Software/Retail Management that will take your business to another level without empting your pocket book.