For retailers running golf shops, this month is about looking ahead and planning how to achieve their goals over the next retail year. When it comes to growing your business, buying the right stock is essential. You may trust in a strong gut instinct to tell you what products have sold well, and which haven’t worked this year, but using the numbers to back this up could still save you thousands of pounds.
Those key decisions should always be led by the information inside your Xpos system and half an hour spent looking at two fantastic reports will give you the confidence you need when deciding what to spend, and where.
“Sales prices are going up so make sure you don’t over-buy”, Phil Barnard
September is an ideal month for reviewing the strengths and weaknesses of last year’s buying decisions. In the fifth episode of our content series “7 Habits of Highly Effective Golf Retailers”, we give you a step-by-step guide to using the key reports in Xpos and show you how to prepare for meetings with suppliers.
When the 2020 pandemic hit our shores, the situation for golf changed rapidly. Retailers were caught out and an element of panic ensued when stock orders were cancelled and pro shops didn’t have sufficient stock to meet demand later on. In 2021, golf retailers went the other way, placing larger-than-normal orders, and many are now faced with having too much excess stock this year.
Says industry data expert and Xpos founder, Phil Barnard, “During Covid, the biggest issue was people’s responses to the situation. Despite the panic that ensued, we know the golf market is very resilient. Right now, making a plan for the year ahead and working with sensible budgets and targets is key for 2023”.
Planning for 2023
When thinking about what to stock in the shop, experts advise erring on the side of caution for next year. It’s likely that the full economic impact has yet to ripple through the industry and, although the market will be larger in value terms, than 2019, it will likely be less than in 2022.
“Sales prices are going up so make sure you don’t over-buy”, warns Barnard, “Bear inflation in mind. Instead of ordering additional items to make up any gaps in your budget, increase the value of those goods, ie the price you sell them for”.
Try to avoid getting swept away just because you had a good year this year and focus on ordering what your shop needs.
Ignore your numbers for 2020 and 2021. Instead, look at the difference between 2019 and 2022, adjusting stock accordingly. Rather than drastically increasing the amount of stock you have, order the same quantities as products will be worth more.
Everything you need to make the best buying decisions is in your Xpos sales and stock management software. Keep it simple and focus on two key reports.
1. STOCK TURN REPORT
As someone who’s involved in the day to day running of the shop, you’ll have an idea of which products have struggled to sell this year and also which brands have performed better than others.
The Stock Turn report will give you the facts to back up your instincts: providing a high-level overview of shop efficiency and revealing the winning and losing product groups.
Use the Stock Turn report to look closer at which product groups (shoes, bags, equipment, etc) and suppliers have performed well, identify poor performance and note the value of stock remaining in the business.
As a general rule, the higher your stock turn number is, the better. A stock turn number of “1“ would mean that you currently have enough stock to last you a whole year, which wouldn’t be efficient. A good strategy is to aim to stock smaller amounts and place new orders as and when you need to top up - as long as you can guarantee the stock will be there when you do want it.
If you’re about to place orders for 2023, the first thing to do is look at the stock you have left and work out how to sell it. Before you go for the clearance sale option straight away, we’d always recommend exhausting other avenues first. For example, review your team’s sales strategy. If a customer comes in for a pair of shoes, try to push the slow-moving stock first.
2. PRODUCT STATISTICS OR SUPPLIER STATISTICS REPORTS
The detail within these two important reports will give you more confidence in your decisions and everything you need to negotiate with suppliers.
Taking your Shoes category as an example, the report will show you all shoes broken down by supplier and how well they have performed. Look closely at items that may have sold well but have poor margins because you had to sell them off at a discounted rate. You want to avoid this in the future.
Similarly, if you made maximum margin on a particular shoe, but you are coming to the end of the season and have only sold 5 with 20 remaining in stock, this should sound alarm bells.
Ideally within a product category, you want to see a lot of stock that has sold, very little remaining in stock and no discount.
Ryan Crowley, Head Professional, Clevedon Golf Club
I will be using the Xpos Budget Planner to help me to create a target for next year and play around with the numbers.
The two key Xpos reports I use are the Supplier Statistics Report and Product Statistics Report. This year, my target is to aim for an increase in margin so that when I sit with a supplier, we can look at products that’ll help me to achieve that. Throughout the year I want to maximise selling potential so I’ll be reducing the amount of discounting we do and focussing on products that make me more money.
I have to take into consideration the current rate of inflation, which is running at about 9-10% at the moment, and isn’t currently reflected in my prices. We’ve already started adjusting those across the pro shop starting with the small things like drinks, sweets and accessories.