How to Manage Inventory in a Convenience Store

Inventory management is the most important business process for convenience stores. Inventory management doesn’t only means purchasing, storing, and selling store items but also involves many other complex activities like monitoring, tracking, and controlling inventory to improve profit margins.

C-store owners should have proper control over the inventory-related activities to execute and optimize the process of inventory management in a convenience store. A complete inventory management system can help you to simplify these processes and help c-store owners to conduct demand forecasting, reduce spoilage, shrinkage, counting errors and so much more to achieve higher financial margins.

Choosing an Inventory Management System

Every convenience store should rely on the perfect back-office software for convenience stores with an advanced built-in inventory management system. The inventory management system should offer complete control over your inventory that enables you to forecast merchandise orders, manage shrinkage to cut down on your losses.

Just like every other convenience store, you have a large number of stocked items and a large selection of products to offer to your customers. You should always want to meet all your customer’s needs and demands because the study shows that 40% of customers are unlikely to return to a c-store where they faced an out-of-stock product or couldn’t find the desired product.

At the same time, you don’t want to blindly stock up your c-store which will result in dead inventory and spoilage and ultimately resulting in thousands and even hundreds of thousands of dollars of losses, depending on the size of your convenience store business.

Demand Forecasting

Convenience store inventory is supposed to be one of the most vulnerable inventories because as a c-store owner you are mostly dealing with perishable items. This is where you have to be extra careful while purchasing inventory for your convenience store and more importantly need a proper forecast to meet your customer’s demand.

Over-purchasing of inventory means huge losses because your store items will become obsolete or spoiled after a certain amount of time. Whereas, under-purchasing means unhappy customers that are most likely not returning to your store any time soon. It will also become extremely difficult for you to gain customer loyalty which is in fact a bigger loss for your c-store business in the long run.

Demand forecasting requires a lot of past data and purchasing history in order to analyze and predict future product demand. Make sure you choose the inventory management software which is backed by a powerful demand forecasting technology to perform complex analysis of the data to evaluate customer demand, buying pattern, best-selling items, etc. It should offer the most accurate reports on the items that your customers are looking for, making it easy for you to stock up your convenience store with the right products in the right quantities.

Automate Product Ordering and Create Stock Order Cycles

A perfect inventory management software system analyzes the purchasing pattern of your customers that will enable you to automate the process of product orders. Automating the process will allow you to create order cycles of individual products and recurring items that will help you to avoid manually ordering a blunt list of products from the suppliers.

Pro Tip: Control Your Vendors

Convenience stores have a very small amount of profit margin because most of the items are significantly low-priced items, for example, groceries and fast-moving consumer goods (FMCG) products that are sold quickly and at a relatively low cost. It’s very critical that you control the inventory cost also known as the cost price. A list of vendors should be maintained in order to compare the cost of products across different suppliers.

You should request price quotes from multiple suppliers to find the products at the best market price. Make sure you negotiate the best price and take advantage of certain discounts and special offers in a long-term deal. Maintain a complete database of preferred suppliers for individual or group of products and increase your profit margins.

Identify the Best and Worst Sellers

It’s very important that your inventory management system quickly identifies your top-performing and worst-performing products. As a convenience store owner, it is very important to identify the products that give you maximum returns and items that are not offering you much in return. Identifying your overall best and worst performer is quite easy but when it comes to the item level the process becomes much more complicated.

The inventory management software could be very helpful in such situations where you have a wide range of alternatives for a single type of product. It will help you to choose the best brand of individual items that are profitable for your convenience store.

Real-Time Inventory Management

Choose an inventory management software with a robust POS system that updates automatically on every sale, order, delivery, or return. These will always keep your inventory up to date with accurate inventory count and give you complete control over your convenience store inventory. Real-time inventory data will help you in the accurate accounting and reporting of your store items.

Conclusion

So your convenience store inventory management system should have all these features so that your inventory management becomes easy and convenient for you. A good inventory management system can help you dramatically improve your profit margins on store items. It can also help you to save a huge amount of money caused by manual errors in inventory counting, accounting mistakes, shrinkage and can help you cut down your labor cost.

CStoreOffice® by Petrosoft has all these inventory management features built-in along with all the other back-office features that are required to run a complete convenience store and gas station business. The c-store inventory management system allows you to perform all the inventory management tasks without depending on different third-party software applications and services.

CStoreOffice® is a cloud-based back-office system designed to increase operational efficiencies and speed data entry, reconciliation, and forecasting to optimize merchandise, food, and fuel sales, as well as margins, inventory turns, shrink, and spoilage.