- Kevin Natapow
This relates to the earlier question about managing seasonal inventory. Again, before placing any holiday orders run a “best seller report” from January- August (typically 50% of annual sales but will depend on your individual sales percentages) by profit and determine which items make up top 20% of sales. Ideally, this report will also have the quantity on hand, so all you will have to do is subtract the quantity on hand from the quantity sold during this time period and then add a bit so that you do not sell out entirely or add a lot extra if you know from history that it is a big seller during the holidays. Also, be sure this report excludes any non-related seasonal items such a spring, valentines, mother’s day items, etc. These bulk up orders can be added to the smaller vendors’ holiday orders but for bigger vendors like TTV, SERRV, Matr Boomie, etc., it is probably better to create a separate bulk order with a later ship date than your holiday merch because the items will most likely not be urgent and not needed to go out with the holiday merchandise. This way you will save yourselves the hassle of too much merchandise coming at once. In terms of how to balance your funds- your OTB (open to buy) is critical in knowing how much you have to spend each month and from there you will know how you want to spend your precious $$$. It is a hard balance because your best sellers are your best sellers and they are what make you $ and increase cash flow. But, you don’t want a gift store in November & December that does not have any holiday merchandise. One thing to consider and do is to run a holiday best sellers report and make sure you are keeping your top 20-30% of seasonal best sellers in stock and as the season progresses, ease back on the seasonal merchandise (especially the bottom tier that aren’t selling as well) and shifting $ to your non-seasonal merchandise. Seasonal best sellers are good to have on hand too as they are worth holding over til next season. Unless cash on hand is a serious issue, you don’t want to be selling best seller seasonal merchandise at 40-50% off at the end of the season- reserve that sale for items you will discontinue anyway or items that are not great sellers. Easy Peasy right???