What is Item Planning?
Knowing the quantities and number of items that will be needed throughout a season can help a business better plan its stock and ensure that levels are consistent with demand. Item planning tools help a business plan for the number of items that are estimated to be sold over a season, helping to ensure that a company replenishes its stock accurately and with stock planning before the season begins. The factors to take into account may vary from store to store, depending on the area and the unique demands that each retail store will see over a season, but they can be clustered together as groups to ensure accuracy across all of the shops you may have.
Item planning can help a business forecast how many units to buy for each SKU (stock keeping unit) and ensure that these numbers are suited to store capacities and the intake plans set out. This strategy helps a business plan out the items they need before the season begins, ensuring that the ordering of amounts is accurate during this time. Item planning helps to make correct forecasts at the item/SKU level, which can be extremely difficult in many industries, particularly in fashion! This makes item planning in fashion incredibly important as you can better estimate how fast stocks of certain items will need to be replenished.
Is Item Planning Important?
Yes, item planning is extremely important for any type of business as it helps to ensure that the supply you order matches the demand for the products that are sold consistently. Purchasing planned items in the correct quantity is vital to running a profitable business that will need to meet the needs of a consumer market. Item plans also need to take into account seasonal and trend factors that a business will see over a period of time, this is beneficial in terms of planning for each store or store group as it can determine which items will need to be replenished and when. Item planning helps to build customer loyalty as they need to know that you will always be able to sell the products that they regularly purchase.
A retail store in the fashion industry, for example, will need to keep up with the demands of the market and always have highly demanded items in stock or risk customers going to another store in the area. Item planning in retail is very important, particularly when it comes to items that are purchased often. Casual shorts and shoes in your store may always be in demand and if customers can count on you to supply them, you will be the go-to shop!
What Metrics Are Used in an Item Planning Strategy?
There are two main metrics that need to be considered when creating an item-planning strategy. Monitoring performance metrics and using this information to create a strategy is an important step as this will provide you with the data that is needed to monitor the performance of stock and the levels that need to be maintained to meet demand. The following are the two different metrics that need to be considered.
- Inventory: Keeping track of inventory and being aware of how long it takes for an item to reach a store is vital when it comes to your item planning strategy. Considering the time that it takes for products to reach your warehouse or store from the vendor can help to ensure that you are not left without stock in certain products. Item planning helps with this as the data provided will be analysed to determine how much of a certain stock keeping item will need to be stored and when it is estimated that a store or group of stores would next need items delivered.
- Demand: The demand for certain items is always important to measure when it comes to an item planning strategy. Planning items and your stock based on the demands of the market will mean that you are able to meet the needs of your target audience and ensure that you are buying just the right amount to meet the demand. Meeting the demand of the market also helps you in terms of the accurate ordering of certain products, ensuring that you do not have too much of one product purchased. Having too many of one item that is not selling will leave you with tons of stock left over, which leads to less profit for the business.
What are The Effects of Item Planning?
Product planning can greatly impact a business and having a good strategy will have far-reaching positive effects. Your business will be seen by customers as being more reliable in terms of always having stock of certain in-demand products and you can ensure that you will not run out of items that are bought on a regular basis. This process can also help in terms of your own budget and the amount that you spend on products as you will be supplied with more accurate order amounts. As item planning looks to analyse data and determine how much of a certain product is needed on a weekly or even daily basis, you can end up saving both time and money when it comes to your inventory and stock.
What are The Advantages of Item Planning?
Item planning can help a business ensure that they are always able to meet the demands of customers. Retailers who use item planning will be able to spot trends much faster than their competitors as they are constantly evaluating the fluctuations of demand! The item planning services offered by QuickApp can help a business better determine which products will be needed at certain stores and in what timeframe. This system also helps to improve the customer experience, as consumers will more than likely find that your store stocks the item that they are after in the correct size and at the best price! Item planning helps businesses make the best forecasting decisions, managing stock calculations and open-to-buy planning at the most basic level. This ensures accurate order amounts at different points in the season!