7 Ways To Prevent Stock Loss At Your Business
Stock losses may affect the revenue of your business, especially if you’re in the retail industry. Businesses realize that inventory shrinkage or stock loss is a real issue that may hurt the bottom line, which can cause sizable profit loss every year. In short, a stock loss is a discrepancy between your accounting records and your physical inventory.
If you’ve noticed a discrepancy between the amount exhibited in your record and the actual inventory on hand, then you might have suffered from stock loss. Various factors may contribute to inventory shrinkage or stock loss including employee or customer theft, misplaced stock, order fill errors, inefficient record-keeping, and shipping errors.
To prevent stock loss because of theft, you’ll need to control every step that involves the stock and improve your stock’s security like through address verification. To know more about this security solution, there are different websites that you can check out like https://www.lob.com.
Below are other ways to prevent stock loss at your business:
Level Up Your Security
There are many ways to level up the security of your business. One of these is to have a shoplifting policy. Ensure that you have a clear plan in place to deal with shoplifters and that the procedures have been clearly communicated to everyone.
Another security solution you can take into consideration is CCTV installation. If the potential thieves think they might be caught on camera, they’re bound to reconsider stealing from you in the first place. Depending on your budget, choose the most affordable surveillance cameras for your business security needs.
If you can’t afford surveillance cameras, an inexpensive alternative is the use of mirrors that can be placed in the corners and some less visible areas to help give extra sightlines and allow staff to monitor more of the areas from one place.
Invest in Your Inventory Management Needs
Theft is a huge contributor to stock loss and one thing that stresses out entrepreneurs. Those who steal from your inventory can be your employees or your customers. So, you have to be vigilant about who’s around your inventory.
There are instances that some customers will walk out of your store and take items that they didn’t pay for while your employees may do the same by taking the backdoor of your warehouse or store. Fortunately, it can be prevented by considering inventory management.
With the best inventory management system, you may track your stock, which can let you know the stocks you’re losing, how often, and when. Moreover, the system will let you see any discrepancy and determine the employees who are always around your stock when it’s missing. To avoid theft, inform workers or employees that you’ll be checking the system for inventory.
Be Firm but Fair When You’re Managing Staff
To avoid stock loss from affecting your profits, you need to have effective and clear expectations and rules as part of the onboarding process, which can signal what’s considered inappropriate behavior.
Enforcing some written expectations is more crucial. Employees must be held accountable for their behaviors. Having rules written down also provides you a documented agreement to refer to if the staff violate workplace expectations like any consequences.
But, give positive feedback when your staff does the right things. If your employees are aware that you’ve noticed their actions, they’re more likely to feel valued and won’t break your trust.
Boost Your Stocking and Receiving Process
Stock losses happen due to damaged stock. By improving your stocking and receiving processes, you can avoid damage to the stock coming in that’ll help minimize or avoid stock loss. To maximize such processes, you have to train your employees about the storage and handling of stock in the warehouse or back room. Another way to avoid damage is the smart placement of items.
Place bigger items on the bottom of the shelves and make sure that they’re easy and safe for employees and customers to reach the items they like to access. In case you have a warehouse or a storage facility, schedule facility inspections. It’s essential since faulty warehouses frequently cause damage to the stocks that are kept there.
Other than performing necessary warehouse repairs, make sure that the presence of fire prevention and detection systems are there at the storage or warehouse facilities that are prone to fire that may cause damage to stock.
Do A Double-Checks System
An inaccurate stock record is caused by using different systems to handle inventory. The best way to avoid mistakes is by incorporating a double-check system when you accept inventory. Moreover, you can reduce the mistakes that occur during data transfer from a system to another by using single automated systems.
Hire the Best People
Your employees shape your business culture and are pivotal in its failure or success. Getting your recruitment right not only enhances your business reputation and customer experience but may also lessen shrinkage.
Find employees who are a good fit for your business and someone who’ll invest in the future of your company. Robust hiring procedures include thorough face-to-face interviews and attention to credentials and experience to understand aspirations, values, and motivation.
Check the candidate’s references to make sure they’ve worked well with others in their previous job as well as for evidence of their dedication and honesty.
Take Advantage of a Point-of-Sale (POS) System
Your POS system is a good asset for your business. Typically used as a cash box, it’s also a costly tool to manage cash and stock-flow more efficiently. Use it for tracking transactions and restricting employees on what they have authorization over.
Set the system to allow discounts, voids, or refunds to be carried out by managers. Link it so that any card payment is processed at the POS terminal. Others are automated to read the amount onto the card readers automatically. If the amount will be keyed in manually by employees, it isn’t integrated. There are some reasons why such wouldn’t be integrated because of the costs.
With the above solutions, you’ll be able to prevent stock loss at your business in no time. Just make sure to implement them properly to get the best possible results. However, if things are beyond your control, it would be best to ask for help from professionals for better stock loss prevention strategies.