Are You Carrying the Right Product Mix?
There is definitely no shortage of food or supply lines that you could choose to carry in your store. As a matter of fact, it can sometimes be overwhelming when trying to decide which brands to carry.
Overall as a basic principle, the brands in your store should be brands that are being asked for by name by your customers. And, more importantly, those brands on your shelves should be making you a profit. One caveat to this would be the loss leader, oftentimes it is a good practice to have brands that you price lower than your cost because they are traffic drivers.
You may not make a profit on the sale, but you are reaping the rewards of being able to sell that customer other products and potentially turning them into a loyal, repeat customer.
Another important element to product mix is to make sure that you have plenty of inventory on your shelves. According to the National Retail Federation, U.S. retailers lose $45 billion in sales from not having enough inventory in stock.
Today’s consumers expect to be able to walk into a store at any time and find the product that they are looking for. Be sure you don’t miss out on that sale because chances are, if they were satisfied, they will return to your store again.
When evaluating which brands you want to carry, you should ask the vendor or distributor rep about the brands advertising activities as well as what consumer driving programs are in place. You also want to make sure that you have the right brands that offer various solution-based formulas. For example, weight conscious, skin/coat problems, grain free, limited ingredient diet, etc.
When it comes to pricing your product mix, be sure to analyze turns as much as you analyze margin. The highest margin items are not always the best profit makers in your store. Many people forget that inventory turns are just as important. Take a look at the graphic below that explains the importance of inventory turns.
Aside from margin, turns, consumer programs, and inventory availability, be sure to also stay in touch with your local market and what trends, niches, or brand followings are emerging. Local tastes, flavors, and preferences should always play a role in your product mix selection.