8 Deadly Wastes of Retail Operations

Posted by Carolyn Williamson on Mar 9, 2019 11:20:00 AM
Carolyn Williamson
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As businesses grow, so do their daily tasks and operations. Unfortunately, in most growing businesses, more than 90% of the activities and time are spent on processes that don't even provide value. Retailers need to reevaluate their processes to stop wasting time, money, and efforts.

To stop wastefulness, get familiar with these 8 deadly wastes of retail operations.

Defective product like these torn at the zipper jeans will hurt brand reputation

1. Defects

Defects are the easiest waste to identify because they affect your money, time, and reputation with buyers.

We get it, sometimes there are defects. But are they hurting your business? Not only does this waste your time and money, but it also upsets customers when they receive the defective product. There are two easy ways to deal with this.

1.  Identify which vendor or brands are being returned the most.

2.  Talk to your suppliers to help improve the quality of your orders. If they don't understand - get a better vendor.

Dealing with reverse logistics of returns is one of the last places you want to spend your time.


Overproduction leads to dead inventory

2. Overproduction

Overproduction can result in dead stock, slow turnover, and lost profits. To fix overproduction, you can discover what products do best by analyzing buying trends through business analytics. After market research,  produce according to your demand.


Wait equals waste in retail operations

3. Waiting

What are you waiting for? But seriously, don't wait around. Stay productive and discover your Power Hours. Know the best times for attending to customers, vs when you can focus on purchasing. Waiting around for a customer to buy while you could be building your brand is pointless.


Processing orders with extra steps and materials can be a big waste for retailers.

4. Non-value-added processing

Do you really need to add a thank you card, return policy, packing label, shipping order, tissue paper, and plastic wrap inside a box? Probably not.

Some glitz is fun, but your customers are way more concerned with getting correct orders in a timely fashion. To do effectively do this, prepare your orders with exactly what they need. Reduce your content to just a few pieces. Add coupons, return policies, and notes on order packing slips.

 

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5. Transportation

Plan for your orders to be picked up on a regular schedule and offer reasonable shipping delivery dates.

If you offer free shipping, make sure to account for transportation costs in your resale price.

Excessive inventory can quickly turn to dead inventory and hurt your bottom line

6. Inventory

Too much or too little inventory is a waste of money. Whether it's the amount you could have made by not ordering enough or the fact that you over ordered, if you're not prepared with the correct inventory, it could put you in financial peril.

Again, lean on buyer analytics. They will help you make quick, informed inventory purchasing decisions.

Learn what warehouse optimization is and why it's so important to your bottom  line.


Reduce moton in your warehouse operations to become agile

7. Motion

Reduce it! No one wants to waste time walking around to complete the next step.  Reduce motion in your warehouse operations by designing your stations with logic layouts. Go through the motion and actually do the activity you are asking your employees to do.

Are the supplies close together?

Let's take a look at the activities of a key role of Comment Selling, the Social Coordinator. - This role needs quick access to garments and to prepare for photo/video shoots.

On a regular basis, they'll need to take photos, jump in front of a camera, schedule and post inventory. Sometimes  they might also need supplies like a steamer to keep garments picture perfect.

Organizing supplies, keeping layouts logical, and keeping in mind different department roles will help you optimize for speed and reduced motion.


A warehouse manager audits the performance of an employee packing and shipping.

8. Employees/Workforce

How effective are your employees? Do you know how many orders people are fulfilling per day or per hour? If not - you may want to take a harder look at how everyone is spending their time.

Pro tip:

  • Get to know their strengths and utilize their passions. Happier employees are more productive.
  • Provide a schedule and hold them accountable for it.
  • Compare their efforts to their teammates in similar roles. If Sara can fulfill 100 orders a day, why can Ben only fulfill 50?

Conclusion

In case you didn't realize it, these 8 wastes make up the acronym DOWNTIME because it's exactly what they cause.

  • Defects
  • Overproduction
  • Waiting
  • Non-value-added processing
  • Transportation
  • Inventory excess
  • Motion waste
  • Employee/people waste

The key is to recognize and eliminate these eight wastes as soon as they happen.

By eliminating these eight wastes you will be able to spend time on the value-added activities that really matter and ultimately increase profitability.

Topics: Inventory Purchasing, Inventory Management

Use CommentSold to boost your warehouse efficiency