Inventory Control

[Hayde]

First time implimenting frame managment & inventory control for an optical. It's pretty close to a 'start-up' so setting it all up is pretty much up to me. Hoping to get some good food for thought from those with experience.

Any preferences on reporting metrics? Frequency of inventory checks? Neat quantity-based equations? What's an average rate of frame shrinkage?

Thanks for your thoughts.

[sharpstick777]

zero is your frame shrinkage... I have had only a couple of frames ever go missing.

Your initial inventory control will be much different than your long term inventory control... you have only a guess of what will sell well.

Recommendations: DO NOT bring in all your lines for opening day, keep 2 in reserve. This way when a patient comes in asks for Face-a-face or Mykita, you have some reserve to respond immediately. (Yes, I brought in an entire line at one patients request, but it was a line on my "list").

Good lines have minimums, and that is Good, if you get exclusivity for a certain radius. You don't have a track record so you won't have great leverage in negotiating though, so don't expect much until your a true A account.

Inventory counts should be done every month. Don't wait for the rep to reorder, re order a sold frame immediately (you will have 20% of your inventory be 40% of your sales so you NEED that frame again). After 18 months you want to target and inventory level for each line of about 2 to 1, 1 instock for every 2 you sell. After 36 months you want to be closer to 2.5 to 1. This will help sales and cash flow immensely.

Everyline has to earn its own keep or shelf space, so have ZERO "favorites", if it sells at 3 to 1 extend inventory. If its 2 to 1 shrink inventory. If a rep asks for more "space" let him or her know the target they have to sell to earn that space.

[drk]

What kind of place are you running? Multi-location chain? Single-location boutique? Dr's office?