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Information Timeliness--Grocery Store Inventories There are 5 replies:
Information Timeliness--Grocery Store Inventories Original post: Sun 10/9/2011 at 10:34 PM

Grocery store inventories are critical to the success of a store.  Inventories must be updated after every transaction.  Once a product is sold and the transaction is complete the inventory must be updated.  By keeping the inventory updated immediately it provides the grocery store with the accurate information it needs to operate efficiently throughout the day.  Grocery stores like many other retail outlets operate under the just in time inventory system.  Since shipments usually arrive daily, inventories can be kept smaller by keeping accurate product movements as long as inventory counts are correct and updated.

Many items a grocery store carries are perishable, and have a very short shelf life.  By updating information after every transaction, product can be accounted for immediately.  Grocery stores place products on a min/max system.  When a product reaches a minimum inventory level it is automatically reordered up to the maximum inventory level.  Products on sale can be tracked throughout the day to see how well the product is moving.  Slow moving products can be marked down.  Many products also have a peak selling season and inventories need to be increased for the peak season.  By keeping this data updated immediately, employees at all levels can monitor inventory, and make changes if needed.

Backups to the data warehouse should be completed daily.  Many stores complete a backup of the system after the store closes for the night.  This is harder to do when some grocery stores are open 24 hours a day.  When stores are under this situation, they should have a policy in place to back up the system at a certain time after midnight.  This way the previous day’s data is backed up.  I know many stores have temporary backups that run throughout the day in case of power outages and other situations.  These are temporary and the system needs a full back up every night to prevent a catastrophic event.  Can you imagine the problems if a grocery store lost just one day of transactions due to failing to back up the information?   Many retail stores do not pay the vendor of a product until the product is sold.  By backing up the data warehouse at the end of the day, this information is stored and safe and vendors are at no risk of not being paid.

Almost every function throughout the day in a grocery store requires up to date and accurate information.  This information is extremely beneficial and cannot be lost.  Losing data can be extremely costly to a grocery store.  Grocery stores rely on up to date information to run their business efficiently, and must ensure the proper data backup systems are in place to eliminate any lost data.  

Re: Information Timeliness--Grocery Store Inventories Posted: Tue 10/11/2011 at 7:44 PM, in reply to Timothy Ray Eckhardt
A major reason why grocery stores need an extremely accurate inventory system is due to their profit margin. A grocery store has one of the smallest profit margins in American Business. Usually less than 5%. They survive based on volume of sales and inventory turnover with little waste. being able to keep just he right amount of product on the shelves without having it expire or go bad before sale, is key.
 
This low profit margin is also a major challenge to having a robust information system. Having the money to invest is difficult. While it is easy to throw manual labor to make up for the lack of automated systems, that also costs money. ie: Have minimum wage stock people doing counts throughout the day and during closed hours.
 
What would be some budget conscience ways to incorporate information systems into their processes?
Re: Re: Information Timeliness--Grocery Store Inventories Posted: Sun 10/16/2011 at 3:08 PM, in reply to Jeffrey Stone
I know many retailers have agreements with vendors to not pay for material until it is scanned throught their pos system.  By incorporating this system retailers are not paying for inventory sitting on the shelves.  The must have good information systems and large data warehouses to store this information.  Vendors need to be paid immediately after the product is sold.  Inventory must be correct also.  
 
Smaller grocery stores are the ones strugging with information management systems.  As you stated many cannot afford the costs of implementing a system and use minimum wage labor to fill the voids.  Inventory tracking and management systems would be the most budget conscious and essiantil systems a store would need.  Inventory tends and spikes need to be accounted for.  Grocery stores must have correct data to order certain products for their certain peak times of the year.  They must also have data from previous years sales to ensure adequate inventory is availabe for those peak times. 
Re: Re: Re: Information Timeliness--Grocery Store Inventories Posted: Thu 10/20/2011 at 8:42 PM, in reply to Timothy Ray Eckhardt
Good job.
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Re: Information Timeliness--Grocery Store Inventories Posted: Mon 8/9/2021 at 6:13 AM, in reply to Timothy Ray Eckhardt

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