Optimising in-store consumables

With retail leaders on a serious mission to save in-store costs, some typical tactics include branch closure, reducing headcount or investing in new technology. Meanwhile, there are potential gains sitting right on the shop floor that can move the needle on efficiency. How a shop floor operates often reflects a brand’s broader efficiency at an operational level and making some critical changes – at scale – can genuinely impact the smooth running of a store and the bottom line.

 

One key tactic to reduce significant costs is around how retailers procure and manage their non-core consumables, their goods not for resale (GNFR). In fact, effective sourcing and consolidation of essential provisions such as packaging, hangers and other in-store essentials can save significant costs and improve processes. Many of the most impactful savings in the consumables space are often missed due to a lack of GNFR ownership.

 

 

Challenges of poor GNFR management

The fragmented administrative processes of provisioning for displaying garments, replenishing carrier bags and cleaning materials are viewed as a burden for store managers and their teams. It’s a typical scenario: Orders are often placed sporadically, and frequently, with orders for different items from various suppliers, even when one supplier can supply a selection of consumable products.

 

There are often hundreds of items needed to make a store run smoothly, with retailers typically sourcing size cubes from one place and toilet rolls from another. This leads to over-ordering which sees delivery costs accumulate, store managers struggle to receive as many as 15 deliveries a month and face ensuing storage problems. The impact on the store includes staff dissatisfaction and churn, poor customer service, and impact on brand reputation.

 

In taking a more strategic approach, retail brands can empower workers to focus on customer priorities and making sales, rather than worrying about stock control and storage of their in-store consumables. 

 

 

Effective GNFR management builds resilience

Organisational resilience is crucial for retailers, ensuring their business can withstand pressures and uncertainties.

 

With the UK high street showing signs of resurgence and in-store playing a critical role in a brand’s customer journey, it’s essential that retail leaders are aware of some ways they can improve efficiency within the in-store environment.

 

One clear route is through consolidating multiple deliveries of non-core everyday items into fewer or once-weekly delivery - everything from hangers and garment display rails and accessories to carrier bags and cleaning materials. Another is to source cheaper items or lighter items, which save on delivery costs. If a brand can save 15% on their consumables’ costs, when applied at scale across dozens or hundreds of stores, this is a significant cost saving.

 

Intelligent ordering strategies also contribute to a thriving store. An organised delivery approach relieves pressure on in-store managers and their teams to order, receive, store and manage consumables. It improves staff productivity and sales. From a sustainability perspective, a brand’s carbon footprint is being restrained and more easily measured.

 

By taking the right approach, retail brands can empower workers to prioritise customer needs and make sales rather than worrying about stock control and storage of their in-store consumables. Keeping employees happy is central to in-store success.

 

 

Benefits of a retail consumables review

An effective retail consumables review will support a retailer in multiple ways. These include: 

• Assessing a retailer’s current processes for delivery, storage and ordering, before calculating their needs and developing a tailored roadmap.
• Recommending the key areas that a detailed assessment of in-store consumables should cover, including performance report, leakage report, internal opinions and ESG suggestions
• Making suggestions for financial improvement such as cost savings through competitive sourcing, a health check on buying and pricing, improved invoicing through consolidation, and control of all miscellaneous spending.
• Suggesting ways to optimise stock control and quality, such as re-engineering and enhancement of products, reduction in wastage, online ordering with order tracking and visibility.
• Advising on regulatory changes - for instance keeping retailers abreast of evolving regulations such as the Extended Producer Responsibility (EPR), a policy that makes businesses responsible for the entire lifecycle of their packaging. Beyond risking fines, failure to meet regulations can damage brand trust if customers perceive a retailer as falling behind on sustainability or safety expectations. 

 

Finding hidden efficiencies

In-store sales rely on a support system that runs smoothly and efficiently. An experienced global consumables partner knows all the main ways to cut costs through shrewd consumables management. They can focus on the areas that matter, streamline the essential requirements and provide the backbone of operational resilience.

 

A thorough consumables review assesses all the in-store areas that are performing well, along with the places where improvements could be made. Those retail leaders that place clear ownership and evaluation around in-store consumables and take a reality check on their current processes will identify hidden efficiencies to cut costs. This will give them the edge on competitors and help build resilience to weather another unpredictable year in retail.

 

---

 

Ian Hall is CEO at CCS McLays

 

Main image courtesy of iStockPhoto.com and oksix