Stockroom Organization is the Key to Success


Whether you work in a store with a stockroom or if you work in a warehouse organization is the key to success. When I was given stores that were under performing I found that the biggest problem was lost sales due to poor stockroom management. Every store that I was involved in that saw a turnaround in sales had major issues with its stockroom management.

You and your team can't sell or deliver a product to a customer if you can't find it in your stockroom or warehouse. There were times where I would find product and staff members who had been there for years would say they had never seen the items on the sales floor.

That would mean that these items didn't have a chance of selling at full price or even making a decent gross margin at sale price. By the time these items are found they may need to be deeply discounted in order to sell. If it is a seasonal item or specialty item that has somehow been lost in the stockroom have you lost the opportunity to sell it?

We are all customers. How many times have you gone into a store looking for an item and it is not there? How many times have you asked a store clerk if they have a particular item, or a certain size or colour of an item? How many times have you been told the store doesn't have it in stock?

I know from experience that in some cases the staff just can't find the item in the stockroom. It might be there but they can't find it. Or to be honest they didn't actually look that hard because their backroom is so messy that they have reached the point where they believe it is futile to look for the item.

One of the biggest reasons I do a fair bit of online shopping is due to the fact that when you go into a store many times I find I can't get the product I want. Now I don't know if the product is in the stockroom. It may or may not be. I just know from experience that there is a chance that what I want is in the stockroom but the staff can't find it or don't know where to look.

Your losing sales, the organization is losing revenue and if your staff is on commission they are losing revenue as well. Then you get into the spiral. The sales drop. You don't get new inventory because the old inventory is still in the store. Since you aren't selling as much the budget for hours gets cut and you have to cut staff. Hopefully, that doesn't lead to a situation where customers don't shop there because of the lack of service which leads to more of a sales drop.

Stockroom Management

The first thing I did when organizing a stockroom was getting merchandise out of their containers whether that be boxes or totes etc. If I did ask someone what was in a box or tote most times people didn't know or they were wrong with regards to what they thought was in the box or tote. If you items have to remain in a container clearly label it so everyone knows what is inside.

Group like items together on shelves. This applies to any item whether it be vitamins, pvc pipe, towels etc. Try and keep them together so that if you have to find them you only have to go to one area. I have always been amazed when you go into a stockroom and find common items in completely different places. There is nothing more frustrating then looking for let's say, 4 boxes of Q-Tips and finding 2 on this shelf, one over on another shelf and one 10 metres away on another shelf.

Communicate with the staff as to how the stockroom is to be organized. You can clean up a backroom all you want but the staff needs to be informed as to what the expectations are for the stockroom or your efforts are wasted. Everyone has to understand the process for product entering the stockroom and leaving the stockroom.

Also, good stockroom management will help when it comes to doing inventory or cycle counts. I can't tell you how many times we spent a week getting a stockroom organized for inventory when I was an Inventory Coordinator. It should never have been that way. However, when it was organized the inventory count went very smoothly.

The managers were always so amazed at how we could have the stockroom prepped so well for inventory. Unfortunately, a week or two after the inventory you would find the same bad habits had continued and the stockroom was not in the best shape.

Which proved the point that you can clean up a stockroom, organize it logically and efficiently with some effort. However, if the managers and staff don't buy into keeping the area organized you can't be successful. Whether it is a stockroom or a warehouse keeping things organized is an ongoing effort but one if done correctly and with passion can lead to success.

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