A brick-and-mortar thingCost of catalogue is a bit of an old fashioned term, used a lot by buying office personnel in large corporate retail.
It refers to the amount of inventory that is required on the shop floor just to look good, just to entice shoppers to buy. Once you fall below this cost of catalogue by, heaven forbid, selling any of it, you jeopardise the ability of the product display to have maximum appeal.
Using in-store displays that are expensive to display require a large initial outlay, but, when done well, should reap the rewards handsomely.
Only certain productsThere are certain categories of product that lend themselves to a hefty cost of catalogue. Here are some examples;
- Denim- traditionally a fast moving product that needs to look and be readily available
- Cookware - where display and visual appeal prompt purchasing of complete sets, so the full range needs to be displayed and available.
- Towelling – the colour array of the towels and the neatly folded blocks have great appeal and require quite a bit of shop floor space as well as stockroom back up to be available.
Managing products that have a high cost of catalogueModern display equipment and minimalist in-store formats are driving down the volume of inventory that is required to look good. For a small to medium retailer that is selling ongoing lines that require quite a bit of shop floor inventory however, there is only one approach that is going to work here; good sales and inventory data is essential. Most EPOS or POS (Point of Sale or Electronic Point of Sale) systems will contain this data, but not necessarily in a ready to go format. Many SME retailers at this point, will be exporting to spreadsheets in order to create some home made forecasting tools. In fact, most modern EPOS and POS systems include the ability to export to a spreadsheet as a desirable feature. (Personally, I’d rather hang on to those hours to do something that I love).
Anyway, however you’re managing this, just make sure that it’s being managed. Here’s how;
- Know the number of items required to form the display.
- Next, you need to know how much you will sell of each item.
- Then, you need to plan your ordering. That’s right. Ordering in this scenario needs to be proactive, not reactive. You don’t rush an order through because you sold a gaping hole in your denim display or when you’ve run out of tea plates and everyone stops buying the entire dinner set. You absolutely need to stay ahead of the game if this is going to work to you and your customers’ advantage.
Help for shopsThere are tools that can manage the forecasting and re-ordering of inventory in a way that is proactive and that drives profits. They have existed for the last 50, it’s just that there hasn’t been away to place that capability into the hands of the smaller retailer until now. Cloud technologies have changed all of that and this is where life just keeps getting better and better for small to medium retail.
If you’d like to know more about the ways in which we aim to help retailers to access the best growth tools, send us a message on our contact us page or on Twitter or Facebook. We’d love to hear about your experiences and how you currently manage your sales and inventory control.