By Evan Wise
Managing Director- Management One®
Point-of-Sale (POS) systems are a valuable tool and a necessity for running a retail store today. YOU CAN'T WIN THE GAME IF YOU CAN'T KEEP SCORE! ALTHOUGH RETAILERS SHOP FOR A SYSTEM WITH THE MOST BELLS AND WHISTLES AND NEAT FEATURES, many have not progressed beyond printing price tags and ringing up customer purchases.
Customer tracking
While all POS systems have the ability to track basic customer information like Name, Address, Phone Number and Email address, most systems have the ability to track customer types (Surf, Skate, Snow, Bike), birthday, anniversary, etc.
Use your POS system to track your customers buying habits. Your customer's purchases will give you a wealth of information from which to do selective marketing. Here are some examples:
· Reward your best customers by sending a thank you gift card or certificate. Invite customers that haven't made a purchase in the past 12 months back to your store · Send a Birthday card with a special offer or incentive.
· Specific merchandising to customers that bought a specific item, vendor, style, color or size There are many creative variations of ways to use POS information to enhance sales, loyalty and rewards programs.
Merchandising Analysis
Your POS system gathers data that feeds a merchandise planning system which is the foundation for your assortment planning. Use your POS system to identify groups of like merchandise (Departments, Classes or Subclasses) and drill down from there. Develop or find the reports that will provide that information:
· Sales and Inventory Report to evaluate your sales, markdowns and inventory levels.
· Best Sellers/Worst Sellers Reports to find items that need to be replenished (Best Sellers) or to identify items to promote or markdown (Worst Sellers). It is best to make these decisions based on gross margin dollars or sell through percent. Unit sales can be distorted as a best seller is not something that was sold through markdowns.· Vendor Analysis Report to find the vendors that performed the best within a group of vendors within a department, class or subclass.
· Vendor Performance Report (shipment) report to help identify vendors that ship the highest percentage of what you order. Size Analysis Report could be a helpful report to compare the sizes you sell to the sizes that are remaining in your inventory.
· Many other reports will help make the right decisions for your business!
Success means knowing the right amount to buy in each classification. That is called open-to-buy (OTB) planning and depends on accurate sales forecasting in each category. Many POS systems offer an option to develop OTB plans. A caveat is that these systems are very simplistic in their ability to forecast sales accurately and therefore the OTB plans can be way off. An OTB planning professional can develop more accurate forecasts and OTB plans to assure you not only get the right goods, but that you get the right amounts (correct stock to sales ratio for each classification each month) and flow them into the store at the right times. That assures fewer stockouts, lower markdowns and the availability of cash to pay the bills when they come due.
Store Management
Most POS systems offer analytical reports to help you fine-tune the operational functions of your store including tender types, salesperson productivity and sales by day and/or hour.
· compare actual store deposits to recorded tender transactions to help you identify losses, theft or bank errors.
· Salesperson Report would help identify your best salesperson by amount sold, number of items sold and even number of transactions. Use this to track sales performance against the goal set for each salesperson each month. When you measure results you improve results.
· Time Period Reports could help identify the best days and times during the day for store activity. A great report for planning days off and break times as well as scheduling sales staff.
Your POS system is a great data collection vehicle, and if used properly can be used to lead you to develop information that can impact the actions you take when running your business. But remember, it is only a machine that relies on human interaction. Maintaining accurate information is paramount and that only happens when the input is accurate.
Your POS system is the start of success. If you drop the ball before the goal line you won’t score.
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Management One® specializes in independent business success by showing any company how to get a better return on their investments in inventory and people. For more information, CLICK HERE
Management One® specializes in independent business success by showing any company how to get a better return on their investments in inventory and people. For more information, CLICK HERE
One Step Retail Solutions is ranked as one of the top resellers and service providers for some of the most comprehensive and state of the art retail POS software solutions in the industry. For a free retail technology consultation, click HERE.
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