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Post by PickyChicky on Apr 29, 2016 21:57:05 GMT -6
What Do You Do if You Can't
Sell Everything in Your Store?
by Lisa McQuerrey, Demand Media
While there is an ebb and flow in the retail business, with a large amount of traffic occurring around year-end holidays, inventory that sits on your shelves and never moves presents a liability for your business. Rather than let unsold inventory stay in place indefinitely, find ways to recoup your investment on slow-moving goods and bring in new product. Re-Evaluate AdvertisingRevisit your business and marketing plan to ensure you’re targeting the most appropriate demographic for your product. Track your existing advertising to check whether you’re getting a return on your investment. If your budget permits, consider hiring a marketing consultant with expertise in your industry to help you assess your promotional strategies. Clearance SaleMove merchandise by reducing the price and having a clearance sale. You may opt to reduce prices incrementally based on how long merchandise has gone unsold. When it comes to perishable items or products with an expiration date, time sales to ensure goods don't go bad before you have a chance to move them. Bundle SalesGroup similar or related products into reduced-price packages to move merchandise in bulk. For example, a stationery store might bundle scrapbooking supplies such as a scrapbook, card stock, stickers, decorative pens and scissors as part of a scrapbooking bundle. Price each item in the package lower than what a customer would pay if buying each piece individually. Liquidation Sale or AuctionLiquidate your inventory by selling en masse to a competitor, reseller or wholesaler. Consider a business inventory auction in which an auction house sells slow-moving merchandise by the piece or by the lot. An auction may be conducted live or online, with the auction company typically taking a percentage of the profits as payment. Donate MerchandiseDonate merchandise that is not selling to a community or charitable group and use the donation as a tax deduction for your business. Talk with your tax or accounting professional to ensure you handle the donation in a way that’s most beneficial for you from a tax perspective. Return MerchandiseTalk to your vendors or suppliers about buying back excess inventory that isn’t moving. Some manufacturing companies or suppliers may allow you to return merchandise or move it to a discount clearance center for sale. Source: smallbusiness.chron.com/cant-sell-everything-store-80241.htmlReferences About the AuthorLisa McQuerrey has been a business writer since 1987. In 1994, she launched a full-service marketing and communications firm. McQuerrey's work has garnered awards from the U.S. Small Business Administration, the International Association of Business Communicators and the Associated Press. She is also the author of several nonfiction trade publications, and, in 2012, had her first young-adult novel published by Glass Page Books. |
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Post by PickyChicky on Apr 29, 2016 22:16:48 GMT -6
Objectives of Demand Forecasting
by Billie Nordmeyer, Demand Media
In 2001, Cisco took a $2.2 billion inventory writedown because of an inaccurate demand forecast. Senior managers eager to avoid a similar financial disaster employ strategic supply chain planning. Such planning best ensures that operational strategies can be developed, providing a realistic opportunity for their companies' production systems to respond promptly and appropriately to consumer demand. Demand forecasting is a key element of demand planning, which is an essential process that supports strategic supply chain planning. Strategic Supply Chain PlanningWhen a business strategy is developed in combination with a supply chain tactical plan, supply chain costs are minimized. As a result, an organization's net profits are increased and shareholder value is enhanced. Thus, it's no surprise when senior management views supply chain planning as a means to differentiate its company's offerings from its competitors. Supply chain planning is a cross-functional process that involves the sales, marketing, finance and operations functions. The mutual engagement of these departments in determining how to match demand and supply minimizes interdepartmental conflicts and leads to the most appropriate allocation of resources for the fulfillment of demand forecasts. Demand PlanningIndividual functional departments, such as sales and manufacturing, take particular actions in anticipation of demand for a company’s product or service. Demand planning aligns these activities by establishing a target for the sale of a product that will be used by the sales department to create demand for the product as well as the manufacturing group to create the supply with which the demand is met. The alignment of the expectations of individual departments regarding demand and supply decreases the likelihood of a mismatch in the actions taken by individual departments to meet supply and demand targets. A failure to match demand and supply can lead to an overstock or understock of inventory that results in either excessive inventory costs or lost revenue opportunities. Demand ForecastingAn instantaneous response of production systems to changes in consumer demand is not possible. Therefore, demand forecasts are necessary to estimate future customer demand for a product or service. These demand estimates serve as the basis of capacity and facility planning as well as selection of appropriate inventory levels, material and supplies acquisitions, capital investments and departmental budgets, marketing plans and human resources activities. Objectives of Demand ForecastingThe efforts of the sales, marketing, finance and operations departments to match demand and supply contributes to the appropriate use of resources in the fulfillment of customer demand forecasts. Demand forecasts enable the manufacturing department to plan production to meet customer requirements. The forecasts also support the purchasing department's efforts to correlate deliveries of materials and supplies with production schedules. In turn, a forecast also alerts finance to the level of investment in plant, equipment and inventory required to meet demand as well as the budgets to be created to manage the business. The demand forecasts also affect the personnel department's hiring and training decisions and the marketing department's assignment of resources to particular product groups or marketing campaigns. Source: smallbusiness.chron.com/objectives-demand-forecasting-32263.htmlReferences About the AuthorBillie Nordmeyer works as a consultant advising small businesses and Fortune 500 companies on performance improvement initiatives, as well as SAP software selection and implementation. During her career, she has published business and technology-based articles and texts. Nordmeyer holds a Bachelor of Science in accounting, a Master of Arts in international management and a Master of Business Administration in finance. |
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Post by PickyChicky on Apr 29, 2016 22:29:26 GMT -6
Different Methods of Demand Forecasting
by Hunkar Ozyasar, Demand Media
Predicting demand for a particular product or service is critical for any business. Such predictions form the basis of capacity planning, inventory management and budgeting. As with most analysis, there is no single best tool for predicting demand. Prudent managers utilize a variety of methods and combine different predictions to make an educated guess. Expert OpinionThe simplest and most common method businesses use to predict demand is to ask experts, whether internal or outsiders. Internal experts can be sales representatives, the marketing department or, in large corporations, a dedicated planning department. Outside experts can be consulting companies that specialize in demand analysis, economists or industry groups. Naturally, it is best to collect data from a range of experts, as opposed to relying on a single institution or individual. Client SurveysAsking actual buyers of the product how much they are planning to purchase can be an excellent method to predict demand. Especially if the product or service is generally utilized by professional institutions with long-term plans, you should definitely interact with them. A contractor will have a very good idea about how much cement he will need over the next year. Similarly, an auto manufacturer will have detailed sales forecasts for auto sales, which are tremendously useful for steel makers that supply the automaker. The method is less useful for simple everyday items, such as soap and cereal, because consumers don't have a long-term plan for purchasing these items. Historic PatternsIf a business has been in operation for an extended period of time, it can usually rely on past data to predict future demand. A supermarket that has been around for a decade will have a good idea about the expected increase in demand for baking supplies during Thanksgiving week, for example. A beverage wholesaler will know how much beer and soda sales go up prior to important football games. Such predictions naturally require high-quality data. To enhance the quality of predictions, you should record not only the quantity sold, but also key event dates and descriptions. Advanced Statistical ToolsBusinesses that can invest the time and effort in more-advanced statistical methods can utilize a wide variety of inputs. In particular, regression analysis can help predict demand based on multiple factors and can be highly useful. A regression model for estimating ice cream sales might use as input the weather temperature, prices of competing products such as cookies and chips, and advertising spending by manufacturers. While the number of inputs that can be fed into a regression model is, in theory, infinite, excessively complex methods do not necessarily produce better results. It is usually best to limit the inputs to variables that are known to exert significant influence on demand. Source: smallbusiness.chron.com/different-methods-demand-forecasting-77999.htmlReferences About the AuthorHunkar Ozyasar is the former high-yield bond strategist for Deutsche Bank. He has been quoted in publications including "Financial Times" and the "Wall Street Journal." His book, "When Time Management Fails," is published in 12 countries while Ozyasar’s finance articles are featured on Nikkei, Japan’s premier financial news service. He holds a Master of Business Administration from Kellogg Graduate School. |
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Post by PickyChicky on Apr 29, 2016 22:39:28 GMT -6
New Concepts & Trends in Merchandising
by Nancy Wagner, Demand Media
Convincing people to visit and buy from your store requires staying on top of merchandising concept and trends. The latest ideas in merchandising are all about educating and informing your customers about the products you sell once you know what they want. By staying on top of new concepts and trends, it’s easier to change the way you present your products to get the attention of buyers. Going DigitalMerchandising your wares is no longer limited to a brick-and-mortar store. To draw shoppers to your store, find ways to use the Internet to give customers information about the products you sell. For instance, offering downloadable circulars and coupons on your website helps customers, since they do much of their planning online before heading to a store to buy, according to market and business analysts IRI. This also helps customers stay within their budget, an ongoing concern for many shoppers. Offering information on your website about seasonal products, special displays, and price reductions is another way to merchandise your goods online. Visual TrendsA new concept in merchandising involves the use of depth deception to add perspective in store windows and showrooms. For instance, according to the Association for Retail Environments, one such use of depth deception includes erecting a wall with cubbyholes that contain LCD panels on which you show digital images of your products. This allows the store to change the content anytime it wants, especially when it offers special sales or wants to focus on a certain type of merchandise for a day or two or at different times of the day, according to who shops at what time. Data CollectionCollecting data about your customers is not a new idea, but the use of mannequins with cameras behinds their eyes is definitely a new concept. The cameras rely on facial recognition technology to gather data about the people who stop to view your window display, says the Association for Retail Environments. The information helps you determine how long people look at the display as well as their gender, race and age. Another trend for gathering data about your customers involves using social networking sites to ask customers what they want to see in your store. Posting messages to find out what’s important to them helps you gather merchandising data you can use instantly to make your displays and products more appealing. MobileThe trend for using mobile technology merchandising grew from just 3 percent of total ecommerce purchases in 2010 to 11 percent in 2012, according to Business Insider. The latest mobile trends include setting up digital catalogs to showcase products and offering coupons to encourage people to stop and make a purchase in your physical store. Source: smallbusiness.chron.com/new-concepts-trends-merchandising-70678.htmlReferences About the AuthorNancy Wagner is a marketing strategist and speaker who started writing in 1998. She writes business plans for startups and established companies and teaches marketing and promotional tactics at local workshops. Wagner's business and marketing articles have appeared in "Home Business Journal," "Nation’s Business," "Emerging Business" and "The Mortgage Press," among others. She holds a B.S. from Eastern Illinois University. |
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Post by PickyChicky on Apr 29, 2016 22:51:26 GMT -6
Promotional Product Trends
by Nancy Wagner, Demand Media
Businesses have handed out free promotional products for decades as a way to keep their company name in front of prospective buyers. Whether you hand out promotional items at trade shows or as gifts after meeting with customers or prospects, your goal is to get people to call when they’re ready to buy your products and services. By staying on top of today’s trends, your promotional item becomes memorable enough to help build brand while creating a positive impression in the minds of potential buyers. Going GreenIf your prospective customers are environmentally conscious, as is the growing trend in today’s society, eco-friendly promotional products help draw attention to your company’s offerings. Promotional products made from recycled materials, such as t-shirts, coffee mugs and magnets made with corrugated paper on the front, all say that company values going green. Tote bags to carry groceries, rather than using plastic bags provided by the grocery stores, are another item on which your company name, logo and website address will be seen not just by the carrier but also by other shoppers. FunctionalityIn a 2011 study conducted by Promotional Products Association International, 69 percent of the recipients of promotional items said the usefulness of the item was important to them. Consider upping the ante with key rings that include tools such as whistles, tiny flashlights or bottle openers. If you’re in the restaurant business or in a food or culinary product business, kitchen gadgets may fit the bill, since they get seen whenever people use them to cook or prepare food. The old standby, refrigerator magnets, is also useful for customers to quickly locate a phone number to call for carryout and delivery or to order appliance repair. ClothingAny items of clothing that can be worn are popular, according to the Promotional Products Association International study, with at least 50 percent of participants preferring these types of promotional products. Add your logo and company name to hats, caps and t-shirts for inexpensive giveaways. Jackets make productive giveaways, although they tend to cost more, so you may want to save those for loyal customers or highly qualified prospects. QR CodesAdding a quick response code, also known as a QR code, to your promotional item gives you a way to interact with your customer. People with smartphones scan the code, which takes them to your website. Free QR code setup is available from a number of websites. The code can link to any page on your website, allowing you to point people to a page with a contest or a special coupon they can use on your products or services. Let people know what the perceived value of the code is when they use it to access your website. Source: smallbusiness.chron.com/promotional-product-trends-61792.htmlReferences |
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