On the surface, inventory management is a simple process. After all, there are only two things you need to avoid: having too little inventory and having too much.

Keeping a perfectly balanced inventory is no easy task, though. Out-of-stock items may easily attract your attention and quickly get corrective action, but overstocked items sit quietly on the shelves. Understandably, these overstocked titles are easily overlooked, as the daily tasks of bookselling and taking care of customers take precedence.

However, to achieve a balanced inventory, you need to pay as much attention to the bottom of your inventory as you do to the top. This will enable you to recover valuable dollars that could be better invested in other titles.

Simply stated, inventory turn is the number of copies you sell of an individual title during the year divided by your inventory level for that title. For example, if you keep 10 copies of a particular title in stock and sell it 40 times during the year, your inventory turn would be four.

The higher your inventory turn, the better you are controlling your inventory. If you reduce the number of copies of a particular title and sales stay the same, you have improved your inventory turn.

Using your point-of-sale (P.O.S.) system, generate a report that determines which titles in your store have sold three or less copies during the last year. If you have more than one copy of any of these titles on hand, you are overstocked.

Using the same principle, run another report that searches for titles that have sold four to six copies in a year. If you have more than two copies of any of these titles, you are again overstocked.

- Bob Steele's 30-plus years in the Christian products industry included experience in training, retail and distribution.

Read the complete article at http://www.thechurchbookstore.com/a.php?ArticleID=14060

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