Question

Pick any retail store you are familiar with. How often do they conduct inventory counts of the entire store? Since damaged goods impacted goals, how or what did the stores try to do to limit the damaged goods? Is this something the store could control? What would happen with the damaged inventory?

Answer 1

Inventory control is of the most important control needed for any businesses today. These controls should be driven as part of business agenda.

My retail store which i am familiar with did inventory counts on daily basis and matched with the system inventory.

These stores adopted few steps as mentioned below to control the damaged goods:

1. ensure proper handling of inventory while bringing from warehouse to selling location
2. ensure in retail shelves it has proper ways of keeping the inventory. For Eg: glass bottles are stacked in enclosed shelves,
3. Ensure proper checking of goods when they are received from suppliers and any damages in transit are debited to supplier account
4. Proper and regular training to staff on importance of handling inventory without damages and steps to be taken in case of damages
5. Ensure proper segregation of damaged goods physically and in system inventory also
6. Regular disposal of damaged goods so that warehouse/retail space is not affected since it would involve rental cost.

Stores can control damages to a desirable extent based on proper handling techniques, regular inventory checks and controls and regular training to its staff.

Damaged inventory has to be properly accounted and regularly disposed off to ensure so physical space is blocked

Proper accounting would mean understand the fundamental reason for damages and account for it. For example if intact boxes has damages in warehouses it has to be debited to suppliers if the organisation has proper handling techniques.

Disposal of damaged inventory means an organisation has a regular vendor with whom rates are agreed periodically to take the damaged goods on regular basis.