The decision has been made. In my previous blog I talked about a large retailer with excess inventory and its intention to hold a sale to move more than $100m worth of stock. I observed this would cause other retailers to follow and it has happened. A large variety store chain has announced that $130m of stock must go in … Read More
Too much inventory and losing it
How to lose a lot of money. Being strongly criticised in the media and a lower share price are often the consequences of holding too much or too little inventory. One of those occasions occurred this week, when a major retail chain reported a poor financial result. Commentators hinted that a monster $100m sale will be held soon – not to boost the … Read More
Again it is risk
Apparel manufacturing in Bangladesh. How are risks of doing business evaluated in your organisation – is it a once per year exercise, a response when things go wrong or a strategic responsibility? The recent collapse of a building outside Dhaka and the reported loss of 1,100 lives once again shines the spotlight on the procurement practices of retailers and whether … Read More
How to save nothing
After the cuts. Labour productivity is measured by increasing output without increasing labour or maintaining output with reduced labour. The second option means cutting the headcount, either done very quietly or with big announcements. In late 2011 a new State government was elected in Victoria, Australia. A part of its election policy was to ‘reduce waste’ in government services. If … Read More
Retail buying can be high cost
Grey imports. A business today is most likely to make its profits from how well it purchases goods and services, rather than its selling margins. This is especially true in retailing because competition keeps retail prices in check. It is retail buyers who purchase goods for resale through their employer’s physical and on-line outlets. All to often their measurement of … Read More