Point of Sale. Most people think of a system that runs transactions, handles payments and prints or emails customer receipts. Most retailers are using POS systems that evolved from electronic cash registers with the transaction, payment and customer receipt being the core features. But today, a POS system should do so much more; it should be retail inventory management software able to provide you the data and metrics you need to make smart business decisions.Your POS system is at the heart of your retail enterprise and should be utilized by every member of your retail team, from the sales floor to the C-Suite. In order to drive sales and margins higher, retailers need POS systems that are useful across every function in the company - including buying.
I recently had the opportunity to speak with a multi-million dollar retail enterprise about how they are using their flexible and robust POS system. Here's a look at what we learned from this chain’s Director of Buying, and how he uses their POS retail software to prep for and buy at market.
Inventory Management in Retail
At the root of their role, buyers go to market to fill their 'open to buy'. The most successful of buyers buy not based on appearance, but on crucial data. But how does one capture all this data? The retail enterprise I spoke with uses Springboard Retail as their POS retail software which was built expressly to track data. On the simplest of levels, Springboard allows them to study the numbers to understand how selling went last year. Which products moved, which didn’t. Understand that skirts outperformed shorts. That yellow sold heavily in March and tanked in August. That blue jeans sold at a 58% margin, while white jeans sold at a 41%.
An important part of inventory data is that it should be kept within a pointed time and Springboard is the only existing POS retail software with this feature. The buyer we spoke with knows that last year, at the end of the second quarter, his sell-through for the Cammy Jumpsuit was 66.5%, whereas the sell-through for the Jaxon Jumpsuit was 38.2%. His smart POS software allows him to collect data, spot trends and understand sales history like never before. And with all of this data in his rear view mirror, he's better equipped to buy for the upcoming season.
How do they capture these numbers though? Retailers are able to run selling reports by department, location, and date. In addition, the data has the ability to virtually place the orders for the buying team. Knowing how varying lengths of skirts in specific attributes sold in deliveries 1, 2, and 3 of summer 2015 can determine how heavily they should buy in those styles with this year’s corresponding attributes. Knowing how well those skirts sold in his Philadelphia storefront versus his New York storefront will determine how he should buy for different locations as well.
Examining your Retail Margins
Additionally, buyers should examine margin and intelligently make decisions when it comes to not only buying, but markdowns. It’s necessary to pay attention to both sales level and profit level; our buyer knows that he sold a lot of white jeans last year, but only at a 41% margin. “A sign that I need to dig deeper into what’s going on there,” he says.
Now the prep is complete and market is here. You’ve analyzed last year’s data, and now you’ve arrived armed with information and are ready to buy. Cloud based POS systems such as Springboard Retail are key when it comes to physically traveling to market as it’s available on every handheld tablet device. Once the product is in front of them at market, buyers can make real time decisions based on data. Having such data at a buyer’s fingertips gives them additional power in the way that they are able to consult and share numbers with vendors, and in turn make better buying decisions and drive effective negotiations. You think we need more of the printed silk tunic? Here’s how it performed last year; I need a discount if you want me to carry it again!
Another efficient feature our buyer loves about his POS retail management system is its ability to integrate with both NuOrder and Joor, two modern tablet-based buying programs. Orders placed in either of these platforms are instantly synced to his Springboard Retail POS system.
Whether in the initial prepping phase for buying season, or physically at any buying show, there's no reason that buyers today should struggle to get the the key data they need to make smart, strategic and valuable buying decisions for their retail stores.