A plan for tracking how inventory moves from the moment items are delivered to the moment items are sold is an essential component for effective small-business inventory control. A ladder plan is an electronic ordering system both small and large businesses can use to place orders and track inventory movements, ultimately ensuring the business has sufficient quantities of products on hand to match customer demand.

About a Merchandising Ladder Plan

A comprehensive merchandising ladder plan can assist in maximizing inventory control and making well-informed inventory-related decisions. For example, an ability to view historical and current sales data side-by-side can be helpful in forecasting and making buying and pricing decisions. Alerts can indicate when sales of specific items increase or fall, allowing you to increase ordering quantities or frequency on popular items and reduce or discontinue ordering for slow or non-moving items. The ultimate effect is that because inventory forecasts can be built on more accurate sales figures, the business can create more effective long-term growth plans.

Ladder Plan Components

A merchandising ladder plan incorporates pricing, product ordering, past sales data and future sales predictions, special sales events and product availability into a comprehensive system. For example, the system continually tracks which items are moving and need to be replenished, provides a timeline estimate for how long it will take to restock popular items and determines how best to price items that currently aren’t moving. In this way, a ladder plan can significantly reduce the inherent difficulties retail merchandising presents.

Ladder Plan Linking Capabilities

The most-effective ladder plan systems link to point-of-sale used at cash registers. Linking capabilities provide for synchronizing real-time ordering with real-time inventory control. For example, you can set up a ladder plan to automatically place an order when sales of a particular item reach a specified level. Because the system considers consumer demand, delivery time frames and supplier production schedules, not only is inventory management maximized but the chances of running short of a popular item are significantly reduced.

Network-Sharing Capabilities

Network-sharing capabilities provide another layer of inventory control and management. Network sharing allows regular suppliers to access your current product inventory and monitor how products are moving through the ladder system. Noting how quickly or slowly products are moving from delivery to sale can assist suppliers in adjusting their own production schedules. The ability to access and monitor your merchandising plan allows benefits the business and participating suppliers by making it easier for both to monitor and manage inventory more effectively.