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In Focus!

Stock management doesn’t have to be a headache. It can be a strategic advantage! By fine-tuning your approach, you can maximise profitability, improve cash flow and ensure your patients always have the best selection.

We’ve put together a list of 6 key elements you can use to start working on your stock:

1. Know your stock needs

• • Understand your patient demographics and purchasing behaviours so you stock the right frames in the right quantities
  • Keep best sellers in stock, keep track of the best selling brands, styles and colours

2. Build a price strategy and understand margin

• • Simplify your pricing with margin in mind
  • Ensure your frames are positioned at competitive yet profitable price points

3. Maintain the right amount of stock and match to your display needs

• • Target stock should include 2-4 weeks of back up stock (maximum)
  • A simple way of deciding your back up stock amount is to run a sales report of the last 12 months. Divide that by 12 if you want your average monthly sales to have a month of back up stock or by 24 if you want to have a fortnight worth.
  • Follow the 80/20 Rule (Pareto Principle) – 80% of sales often come from 20% of your stock. Identify those best sellers and try to keep them stocked up

4. Brand selection & patient experience

• • Having small amounts of too many brands can dilute your offering. Focus on curated selections that resonate with your patients and improve their buying experience
  • Try different ways of displaying stock to make the buying experience easier for your patients. Practices have had good results displaying by colour rather than brand. Trial options and see what works best in your practice

5. Setting buying plans & rules

• • Set a buying plan to control spending, prevent overstocking, and keep your stock fresh
  • Have plans for dealing with overstocks and aged stock – for example clearance sales, packages, or second pair options
  • Ensure you have a quick fix for understocking – this may include displaying your stock differently so gaps don’t stand out as well as ordering top ups quickly
  • It’s OK to buy in between rep visits if you need the stock. Don’t let your best selling brands get low on stock

6. Measuring, monitoring, & reviewing stock

• • When you start to work on your stock, a review is important as it gives you a starting point
  • As you make changes, reviews are important as they show the impact of what you are doing
  • Adjust your buying, merchandising, stock plans based on the reviews you do
  • Don’t let old stock sit in the drawers where it won’t sell. Continually check what you have on display to minimise aged stock issues