Store Inventory Management Assessment
Identifying areas of maximum opportunity related to the handling and merchandising of products in physical stores
A $14 billion specialty retailer operating 800+ stores under multiple banners, brands and store formats.
The Store Operations organization was faced with the implementation of a new inventory management system to specifically support softlines. As part of this project, there was a need to examine current store operating activities. The goal was to identify improvement opportunities as well as uncover business processes that posed a risk to achieving the transformation's benefits and adoption of the new system.
The Parker Avery Solution
The Parker Avery Group assessed the client's store inventory management systems and processes to identify areas of maximum value related to the handling and merchandising of product in stores.
The Parker Avery Group identified 38 opportunities for improvement to store inventory operations and overall business performance within the following six operational areas:
- Truck Processing
- Back of House Management (BOH)
- Sales Floor Procedure
- Replenishment / Restocking
- Price Changes and Ticketing
- Store Transfers
Our approach included the following key activities:
• Reviewing organizational structure, roles and standards
• Leading stakeholder sessions and interviews
• Participating in system configuration and design workshops
• Conducting store walks for all store formats in multiple districts and states
• Gapping current processes and reconciled against industry leading practices
• Documenting back of house configurations and exceptions
• Defining business case that supports improvement opportunities in coordination with the deployment plan
Based on our findings, The Parker Avery Group recommend ten action items with prioritized tactical plans for both immediate action and as part of the system roll-out. High priority action items included developing SOPs for shipment exceptions, carton processing, item ticketing and inventory counts; establishing replenishment procedures for basics / never outs; implementing a formal store-to-corporate communication channel; and cross-training store associates to improve merchandise knowledge and processes.
As a result of the project, the client expects to achieve an average increase of $65 margin dollars per square foot in the softline business along with the following benefits:
- Sales improvement
- Markdown reduction
- Improved turn and BOH organization
- Increased replenishment efficiencies