Creating an Efficient Supermarket Inventory Management Plan

The average mom-and-pop grocery store has truly evolved over the years, and much of that evolution has to do with necessity. Both mid-sized corner institutions and large-scale supermarket chains now face a number of grueling challenges in order to stay profitable, one of which is managing inventory.

Supermarket inventory management used to consist of a physical count and a manual tally of each inventory item. But recently, both local and international product lines have grown bigger and more diverse, with more suppliers having entered the arena to vie for customer attention, and competing supermarkets have started peddling additional fulfillment options. As such, it’s important for a supermarket’s inventory management plan to be efficient, responsive, accessible, and suited for the times.  

If you helm a local supermarket, then you must know how exhaustive inventory management must be. The bigger the product mix you have in your supermarket, the more tedious inventory management will seem. But luckily enough, there are several action points you can take in order to craft an efficient supermarket inventory management plan. When you have such a plan in motion, it will contribute significantly to your supermarket’s financial management, customer service, product tracking, and theft control.

Be sure to check off on the following items when you draft your inventory management plan:

1. Determine your sales goals per quarter. It would be good for you and your staff to start the quarter with a meeting on your sales goals. Get everyone briefed on new products you’ll be introducing, new supplier relationships you want to maintain, and particular items that you want to move during the season (such as during a summer sale or a Christmas sale).
2. Upgrade your accounting software to include inventory tracking and management features. You may not know it just yet, but upgrading your existing accounting system may be the all-around overhaul that the institution needs. Installing the right accounting software will increase the speed and efficiency of order processing, as well as enable a bird’s-eye-view of the supermarket’s daily profits. But upgrading the supermarket’s Point of Sale (POS) system to include inventory tracking and management features will also help you track item movement to and from the store, almost in real-time.
3. Don’t eliminate the task of physical counting. Inventory management upgrades don’t render the physical count completely obsolete, however. There are some aspects of inventory management that require a more human perspective, such as checking the physical condition of a set of products. You and your staff should still enact a physical headcount of items on a weekly or monthly basis. See to it that the products in your supermarket are accounted for and that there is minimal damage to what’s on the shelf.
4. Make it easy for your staff to know what each item is and where it belongs. There may be hundreds of different products on each aisle, and memorizing what goes where might be a pain at first. Lessen the logistical burden on your staff by labeling items with a number scheme that’s easy to follow, marking their place on the shelves, and mapping the aisles. This will also help your staff do a good job of referring customers to the products they need.
5. Foster an awareness of products with short shelf lives. One enduring challenge of the supermarket is its perishables section. It is often a race against time to move perishable products out of the shelf before they expire. Of course, such items must be marked with a best-before label. But you can also take on additional measures to forecast spoilage, such as including these sell-by dates in the inventory balance scheme. This way, your staff can easily implement the first-in, first-out (FIFO) method of stock control and flag any potential expirees.
6. Replenish the items in your inventory”not just on a per-product basis, but by group. In some cases, customers enter the supermarket with the intention of purchasing their favorite brand but are quick to choose an alternative of the same category. For example, if a customer needs a kilogram of sugar, they may gravitate toward Brand X at first but won’t hesitate to pick up Brand Y if Brand X isn’t available. The nightmare situation for both the customer and the grocer is if neither X nor Y can be bought. Avoid this situation by understanding how these products behave in a group and by making sure that your inventory preserves the customer’s choice.
7. Collect the history of your inventory data. Take the time to sit down and review the numbers that your inventory specifies. This will give you some much-needed insight on periodic supply and demand, what current purchasing trends are like, and what decisions to make in order to prevent both shortage and overstocking.

Ultimately, the keys to efficient supermarket inventory management planning are discipline, foresight, customer responsiveness, and a little tech-savvy. Running a supermarket isn’t easy, and the work will always keep you on your toes. But here’s to properly managing your inventory, offering the best that your customers can find, and keeping the door open for them for years to come!