Retail surgery: We think we are incurring high losses during our Sale. How can we minimise these?

The Sale season is an especially difficult time for retailers to keep a handle on their stock, but it is nevertheless important, as shrinkage can quite easily occur in the Sales mayhem both as a result of shoplifting and process errors.

IDM Software chief executive Khuram Kirmani says that the first thing retailers can look at to minimise losses is to check that Sale stock has been re-priced correctly, which can be done by checking for variations in prices going through the tills by SKU. Quickly picking up on stores that have been re-pricing stock incorrectly is essential as process errors can lead to bigger shrinkage losses than theft during the Sales.

He adds that retailers should also audit their store stock during the Sale - even though this can be time consuming - to highlight if particular goods are being stolen more than normal during a Sale.

Whether an audit and analysis is done manually or with sophisticated data analysis tools, you must apply the same firm discipline and make sure that store staff are given clear action to take as a result.

Kirmani adds that whatever policies a retailer decides upon, it must make sure that permanent staff are well trained in them, so they can assist temporary staff that are employed during busy Sales periods. “Otherwise you are about to amplify any weaknesses by a factor,” Kirmani warns.