Inventory Coverage in our Retailer tool is built to show you overstocks and understocks in the store. We are able to show you this through a stock coverage ratio. Ratios are the quantitative relation between two amounts showing the number of times one value contains or is contained within the other.
Below is a sample analysis from Inventory Coverage and what the data is telling us in the example.
Scenario: I am wanting to see by category, how my stock coverage looks at the store. I will pull up the Inventory Coverage dashboard in Retailer and begin selecting my filters.
Store: Location you wish to run the analysis for
Forecast Sales Based On: The historical time frame we'll use to analyze the number of units that sell per day on average. 60 or 28 days
Inventory Should Cover: The desired number of weeks worth of inventory you prefer to have on hand at the store at any given time
Product Grouping: How you want to see the coverage represented - by category, brand, vendor, or unit
Optional Vendor, Brand Category: Filters allowing you to drill into one area specifically if you want
In the example above, I'm telling the report that I want to analyze:
- The previous 60 days of sales
- I would prefer to have 3 weeks of inventory on hand at all times
- I would like to see my coverage broken down by category.
Everything that appears in the report is going to be based on my above selections.
Once the report runs, you will see some summary data at the top for sales, quantity on hand, and the distinct number of products in the store. Then we move on to the actual stock coverage ratio.
At the top of each bar in this graph, we show a ratio. Again, we have to think back to what filters we selected in order to understand this ratio number. The ideal ratio to have 3 weeks' worth of inventory on hand (per the filter I chose) would be a 1.0 ratio. 1.0 means we have exactly 3 weeks on hand as of today.
Let's look at the Pre-Roll category in the image above. We show a stock coverage ratio of 0.58. This ratio means that we have HALF of the inventory on hand that we prefer to have. Half of 3 weeks would be about 11 days or so remaining for this Pre-Roll category. We definitely need to order here.
If we look at our topicals and capsules, there's a ratio of 2.4. This ratio means we're overstocked and we're overstocked by nearly double. A ratio of 2.4 means we can cover 3 weeks of sales two and a half times over. So we have at least 7 weeks of inventory on hand as of today. Not only do we not need to order in this category, but additionally, we may even want to run a promotion of some kind to get those units moving.
Let's say, we want to take a look at what products are moving slowly in our overstocked Topicals and Capsules. All you need to do is click on the ratio number above the bar and a pop-up window will appear showing you individual products in that category and their individual coverage ratios.
Moving down the dashboard further, you can analyze the number of products in the store that have had no sales in the time frame you chose, as well as, the days remaining for your current inventory based on the average number of units selling per day.
Lastly, the bottom of the report is a raw data table of your products in store for a deeper analysis into overstocks, or understocks by product.