“Well have you heard about the great crusade? We ran into millions, but nobody got paid.”
These prophetic words to the Hunters and Collector’s famed song could well apply to one of the most critical inputs to franchise and speciality retail success It’s always interesting to see that it’s not lack of profit that influences the “business fitness’ of a business is the cash flow and the “holy grail of retail” is to understand the relationship between sales, margin and closing stock.
These three critical inputs are simply sales, margins and closing stock levels. Time and time again we see that stock levels are the ‘poor’ cousins of the three yet they command the single largest investment a retailer makes.
How can your business replicate the world’s best retailers, accurately managing your stock levels - thereby avoiding unplanned markdowns along with maximising cash flow and profits, while others just buy what they think will sell, then cross their fingers and hope for the best?
How many of us really understand the significant impact that a well managed stock position will have on increased sales, liquidity and profitability?