Managing Excess Inventory
According to Xpos founder and Golf Datatech partner Phil Barnard, the UK golf retail market witnessed a slow start to 2024 with a decline in sales of 4.7% vs 2023. Despite drier than normal weather during January, on-course shops took the brunt with a 10% decline in sales on last year.
It’s been a tough few months and, following recent visits to several pro shop customers, I can say there’s definitely more than a whiff of pessimism in the air right now. With longer-term weather projected to get wetter, and major non-golf events coming up this year, including the Olympics and Euros, the feeling is one of doom and gloom. On top of that, most shops I’ve visited recently were struggling with too much dead stock and have an average stock turn of between 1 and 1.5.
Damaging Dead Stock
Your Stock Turn number is the rate at which your products turn over and sell during a 12 month period. In the UK golf retail industry, we’d hope to see a Stock Turn of around 3 for on-course shops. No product should have a birthday in your pro shop – that’s our rule. And shops currently seeing Stock Turn numbers of 1-1.5 need to act swiftly to clear old stock. (Watch out for a new article on Stock Turn shortly).
Outside, there are strong signs of Spring and, weather-wise at least, things will soon be looking up. The golf boom will continue, golfers will return to the courses and the pro shop doors will be swinging once more.
In the meantime, let’s deal with your shop floor and how to tackle excess inventory.
Fuel for Growth
This year, we launched our new educational series “How to Grow a Pro Shop” to help our retailers understand the fundamentals needed to fuel their businesses. Getting the balance of stock right sits at the very core of your shop growth.
Excess stock is bad for business. Surplus stock take up space on the shop floor and ties up valuable capital, hitting your bottom-line profits hard.
Use Xpos to Identify Trouble
Checking your Xpos reports is the first step to tackling dead stock. Use them weekly to get a real-time view of stock levels across your categories and brands, and to pinpoint the slowest turning items.
During your busiest times, it’s essential to keep track of performance. You want enough stock to meet customer demand, but also a plan to deal with less popular products.
Essential go-to’s for stock management include the Sales Analysis and Stock Turn reports in Xpos and you’ll find these in V2 as well as the new cloud system.
Sell Smart
Once you’ve identified your dead, or slow-moving stock, make a plan to sell it on. Here are some of my tried and tested tips:
- Giving the shop a fresh look and moving stock around will motivate the whole team, and encourage customers to take notice
- Discounting and bundling are techniques that will move product off shelves and spark sales via word-of-mouth referrals
- Remember clearance sales can deter customers from buying your newer stock at full price. For this reason, when it comes to older stock, (ie, more than a year old), look at ways to sell it away from the shop.
- Involve the team and incentivise them to sell slow-moving items. Staff tend to feel more passionate about exciting new hardware so put schemes in place to encourage the team to focus on things like shoes and clothing. These items carry high margins and you don’t want to give them away.
From this Spring, the new Xpert app will be available for Xpos customers opting for the Stellar package. The app helps retailers keep on top of shop performance with a real-time, user-friendly dashboard which includes up to the minute data on stock turn, margin and turnover.
Get in touch via hello@xpos.co.uk for more information.
