Companies I have experienced stock control:
Dates Employed: Oct 2014– Current
Title: Customer Service Assistance – Merchandiser, Stock Control & Price Integrity
Dates Employed: Oct 1999 – December 2001
Title: Operations/Sales Assistance – Trainee Team Manager
Stock Record Details
Stock control is a vital department for any business to have loyal customers, to review stock records, to record down any damages or thefts, to reduce near out of date products and investigate problems in areas needed. Without stock control, there could be areas of the store that might be without stock for some time and could also raise concerns.
The stock record needs to be updated and as accurate as possible every day of the week to keep up with the expectations of the customers. As products arrive, the system will update record to reflect this and as they sell, it will be removed. However, there are times when this record number can be wrong for several reasons.
Reason one – Theft
Theft is a frustrating area and subject for any company or store as they decrease the availability towards who do not and cost the business a lot of money. The theft comes in four methods (to my knowledge) and can have an impact in their own ways. Here is my understanding;
- Internal theft (within the store): There are times when you come across colleagues that are dishonest and will take items without paying. Hopefully, those who do this will be caught however, the stock figure will not change and will remain at the current level. This internal theft causes such big issues as it can be un-noticed until the shelf has a gap.
- Internal theft (within the depot): The items might be recorded down on the system as to be delivered the store but might never be loaded. This record does not change as the store system updates to show it has arrived and stocked for the customers. This might not be picked up for another couple of days to investigate where the stock has gone and will be recorded as theft costing the company more money.
- Theft from dishonest deliveries: There have been stories of dishonest drivers that have allowed items to be removed from their lorry, also known as the back of the lorry. This will be recorded down on the system as delivered until its investigated as missing. It will be unknown how this went missing however, it must be noted that most companies now have seal numbers recorded to stop this from happening.
- Dishonest customers: Unfortuntly there might be times when a customer will take an item without paying which also affects the stock record levels. The level will not change until the product has been investigated for being a gap.
Reason two – Operator error
Another reason for why this stock record number might not change is related to the till service, both self-service and via the traditional method. There have been many times when I have seen my colleagues scan one item, counted what was in the basket and them multiplied it on the till to match. The price is the same however, the product numbers are not and this causes an issue on two fronts. An example of this is shown below;
Stock record details at the start of trade: 20. Case size is: 10
Capacity that the shelf can hold is: two cases (this has correct amount of stock needed)
Stock record details at the start of trade: 10 Case size is: 10
Capacity that the shelf can hold is: two cases (this requires one case to be delivered)
A customer comes to buy ten of their favourite flavour, which is A and then two of the least favourite, B. At the end of the customers shopping, they go to the till and place the products onto the belt to be scanned. The member of staff notices the products and believes them to be similar in design. To increase speed, the member of staff picks up one by one and place them into another area for the customer to place them into their bags. As they get to the last product, the member of staff scans product B and multiplies it by 12. As they both on offer, the customer is happy and pays.
The issue here is that the stock record has now changed and had an impact on the store’s replenishment. The stock record now shows this information;
- Product A: Currently recorded as 20
- Product B: Currently recorded as -2
By the end of the trading day, the stock record will continue to be incorrect and will cause the system to question what has happened. Using the example above, product A has shown as no sales however, product B is showing as selling more than what was on the record. This can cause issues as product A will not be ordered to replenish the shelf and product B will be ordered, however, a question on the counting will be needed to remove the negative number. This stock figure will now be recounted to correct the issue with can lead to several issues.
Recount is required on one product
The system will only highlight product B as a miscount and will demand a recount to correct the negative stock record number. Product A will not be highlighted until it sells more. Here is the issues that this has raised;
- Product A: This product will not be ordered until it reaches a sales of 10. As a result, this will cause a negative customer shopping experience.
- Product B: This product will need to be recounted, it will show an increase of 8, which will question how the extra sales came from. The system might have already ordered additional stock to match the demand causing over stock (backstock) increase.
Any stock control would need to search the shop floor and warehouse once more to find out why there were an additional sales. If noticed, they might be able to see that one is showing more than the stock figure as the other is showing less. Using the labels and offer details, you can check the other item to see if the details match the system. A recount would be needed for that additional item if discovered to be incorrect. As you can see, this causes a lot of issues. This could also be looked as theft and raise issues that might not be needed to be looked into.
Sales based information
Many companies keep an eye on how the products are performing in sales and the reaction from the customers. Having the correct details on the stock record helps several departments review these details. Below is an example of how this works;
Current stock record at the start of trade: 20, expected sales for today: 5.
Due to error: The sales record is shown as 0, showing this product is not in demand for today
If correctly performed: The sales record would show as 10, showing better than expected sales.
Current stock record at the start of trade: 10, expected sales for today: 5.
Due to error: The sales record is shown as 12, showing this product is in demand for today
If correctly performed: The sales record shown as 2, showing under the expected sales for today.
These sales and stock record details affect the following departments;
- Merchandising department: This information helps towards a better understanding of how facings the product might be displayed on the shelf. If the product is in a high demand for a couple of months, an increase of facings will help towards a better shopping experience. If the product is not selling well, a decrease or discontinuation might be needed.
- Shareholders reviews: Shareholders takes a risk on new products and how they take up space from others that are selling well. Investments in advertisements and getting this product into the store will require a good return and reaction from the customers. If the products are showing low in sales, a company representative would often come to investigate why. They will look into the replenishment or merchandise issues to see if they can increase the sales.
- Head office reviews: If a certain product is selling well, some brands like to create their own alternative options. For example, toilet rolls nine pack might be selling better than four and can be a good opportunity to get an own brand on sale.
Reason three – Deliveries
The deliveries need to be correctly delivered and details to be checked to ensure a correct stock figure. Here is an example below to show you how and why this might affect the store.
Store 1 details: Stock 300 products. Store 2 details: Stocks 121 products
The delivery has the following scheduled for that day;
Store 1: Deliver 13 cages
Store 2: Deliver 8 cages
Store two receives the delivery first and starts the to unload the cages whilst not monitoring the details of each cage. The driver is also not taking notes as they speak with each another about football and having a laugh with each another. Once loaded, the door is resealed and the driver proceeds to store one. As the driver arrives, the cages are not counted as its the last store and the driver returns back to the depot.
The replenishment team manager arrives in store two and counts 9 cages for delivery. The manager does not question this as there is no need as the back door colleague had dealt with the details at hand. In store one, the same person in that position counts 12 cages and plans on how to perform the tasks at hand.
As you can see, there is an increase in one store and a decrease in another, which affects both of them in a big way.
- Store 2: This store has an increase of stock and can cause several issues. They currently hold 179 fewer products. This means that the store is unable to stock many more items and will struggle to find room as planned via floor plan. This one cage might hold products not stock by the store and will cause a back stock problem. There will also be items that they do stock, however, the delivery details will not be shown as the cage was not for this store.
- Store 1: With one missing cage, these items could be popular buys and will now be missing. This causes a negative shopping experience for the customer and a large investigation to where this stock might have gone. As there is a record of a correct delivery from the back door colleague and driver, the items have to be stolen. The security department will now need to be involved to find out why, taking time away from other matters at hand.
For store 2, this extra cage will increase nonstock products and possible negative product stock figures. For store 1, the store will have an incorrect stock figure on items that might not be investigated until a gap forms. This can be from one day to a couple of months based on how much sales. This error can also effect promotional changeovers, where the extra stock never arrived to fill the promotional ends.
Reason four- Stock take
Stocktake will usually solve all these issues however, there are times when this can only be performed between two to three times a year. To much of a positive number will give the store the reputation of having a weak stock control team as too much of a negative can lead to an investigation of theft. However, based on the information above, which one could this be?
This is my experience in stock control to this date as I continue to learn more about this department.