Life Cycle of a Product/Inventory Prep

Life Cycle of a Product

4 Steps

Phoenix -

• Our point of sale system
• Tracks all items for sale
• Shows Profit margins
• Current on hands
• Reporting for reordering
• Involved in every aspect of a product
• Ordering, Receiving, Accounts payable
• Selling,

Outside Vendor Buyers

6 Buyers for Al's

• Perennials & Houseplants - Judy Alleruzzo
• Trees & Shrubs - Aaron Rivera
• Gifts & Christmas - Candace Moffatt
• Dry Goods -Bruce Peterson
• Garden Accessories - Darcy Ruef
• Patio Furniture - Teri Schafer

The buyer

• Works with vendors to determine what to purchase
• Sets the retail price
• Determines how many go to each store

Registers

• Customer Decides to buy product
• We ring product through the register
• After sale is complete, on hands are immediately adjusted.

The buyers then use these quantities to determine what and when to buy next.

Receiving

The buyer turns the order into Receiving who creates the items in Phoenix and creates an internal purchase order.

When the product arrives, receiving:

• Counts the items in
• Separates items to be transferred to other stores

Once the items are counted, the product is entered into Phoenix showing a positive stock

on hand. ***Currently to SW inventory***

Sales Floor

After the product has been counted, it's released to the sales floor.

Farm Products

The majority of the Trees, Shrubs, and Perennials we sell at Al's are grown at our own growing facilities.

These products are still treated as though they are coming from an outside vendor and go through the same 4 step process.

Exception to the rule

Annuals don't follow the same 4 step path as all other product.

Instead they skip the receiving process and go straight from being ordered to going on the floor.

They are still accounted for in Phoenix, but after they've sold.

Life Cycle of a Product

Sections should have about 10 to 50 line items in them

Any item can go in any section.

Transfers

Two Kinds

• Buyer directed - Order received to the warehouse and split to stores based on buyers direction

• Inter-store transfers - Al's employee at any location initiates a transfer for:
• A customer
• Balance Stock - per buyer

Creating Sections

Each department needs to be split into sections that various teams will be counting.

Goal - to insure we count every single product that we could sell.

Smaller Sections = Easier to count

Dump & Damage

If an item is damaged or unsellable, we need to remove it from inventory before it's thrown away.

Keep your sections consistent

• If you're setting up clothing, do each arm of a 4 way as a section
• If you're setting up perennials, do the front side of the tables as one section and the back side as another

Physical Count Overview

Customer Returns

When a customer returns an item:

• Proper communication and training is needed.
• Some return codes remove items from inventory, and some do not.

Creating Sections

Preview of the Day

of Inventory

Section Signs

Email receiving with completed section lists prior to inventory day.

We use this to guide us through the day.

Each section will be formatted as:

Department# - Store # - Sequential Number Starting at 1

Example for Perennials at Sherwood: 15-2-1

Example for Garden Accessories at Woodburn: 60-1-47 (after you've done 1-46)

Example for Gifts at Wilsonville:

30-5-15 (after you've done 1-14)

Your section list should include the section number, and a brief description

How many hands

A typical product, not being transferred, passes through 7 sets of hands.

Next Up: On the Day of Inventory

Preparation

A typical product that is being transferred, passes through 10 sets of hands.

Setting Up Sections

Actual Life Cycle of a Product

Hanging Section Signs

Why does EVERY item need to be tagged?

For inventory - items need to be counted the same way they will be sold

For customers - wanting to buy items without a tag or price can be very frustrating. An easy way to lose a sale.

Try to eliminate searching for products with missing tags and/or using Generic Department Codes

• Hang in a consistent, visible area
• Draw arrows and write notes on your section sign
• Outside?-Recycled waterproof paper
• Use flagging tape to differentiate between areas

Generic Sales

Used at the registers when a product does not have a tag and cannot be found by searching.

• Make sure all items that are grouped together are the same sku
• Block same skus into sections or rows
• If you have two items that look the same but have different SKU's, separate them

Creating Section List

Good preparation is the key to an accurate count

• Make sure every item is tagged
• Organize, organize, organize
• Dump & Damage non sellable items, then remove them from the property

Good opportunity to clean up all

retail areas.

Master list of all sections created for inventory control to check against.

Phoenix Numbers

Each phoenix number is a unique 9 digit sku.

Apple Honeycrisp N7 Semi-Dwarf

Each Phoenix number is also assigned 4 levels of categories

Section signs can either be typed or hand written

Category 1

Category 2

Category 4

Category 3

= Department Number

= First two numbers of the Phoenix number (usually)

Physical Count Overview

Measuring with Variance

Physical count is taking a count of EVERY item we sell.

These numbers are uploaded into Phoenix and overwrite all existing quantities.

Variance - difference between oh hand in Phoenix before the physical count compared to the actual count.

Example: If we counted $7,000 worth of inventory and Phoenix said we had $10,000 our variance would be 30%.

Previous Variances

How does this affect me?

• Check on-hands for other stores
• To meet customer needs
• Ultimately it affects customer service

Why do we need do this?

Every business is required to do inventory because it's needed for accounting, tax, and insurance purposes.

This count also sets the quantity basis for the whole year to come and the following year's physical count.