How to manage stock in a small shop so you never run out or overbuy

For many small shops, stock is the largest part of the money. Managing it carefully can raise your profit without raising your prices.

Know your fast and slow sellers

Write down which items sell every day and which take weeks. Keep a good supply of fast sellers and buy slow ones in small amounts.

Keep a simple stock book

1. List each item and its buying price.
2. Record every time you buy new stock and the date.
3. Record what you sell each day.
4. Count the stock on the shelf once a week and compare it to your book.

If the numbers do not match, find out why, since the cause may be wrong change, waste, damage or theft.

Set a reorder point

Decide the amount at which you must buy again, for example when only five packs are left. Remember the time your supplier takes to deliver.

Arrange your shelves

• Put older items in front so they sell first.
• Keep food and drinks away from heat and damp.
• Check expiry dates regularly.

Avoid dead stock

Do not buy a large quantity just because the supplier offers a small discount, unless you are sure you can sell it. Slow stock should be discounted early rather than left until it spoils.

Use your records

At the end of each month, see which items brought the most profit. Spend more of your money there.

Written by the EarnNaija team at EarnNaija Digital Technologies.

This article is general information, not financial or legal advice. Earnings are never guaranteed. See our fees page for the exact costs.