Supply Chain Management For Small Retail Stores

Small retail stores often face some of the toughest competition from big chain stores. These bigger stores can place bigger orders and often sell, at a discount, the same products available at specialty stores. Most consumers want their product on the spot, rather than waiting for an order to be processed and shipped. Small retailers have to stay informed about their inventory and be prepared to redirect individual shipments. One way specialty store retailers can level the playing field is through supply chain management.

Reducing Expenses

While you may be qualified to inspect a manufacturing facility or evaluate a distributorship, you can ask questions and compare. Part of supply chain management is to find practices that increase the expense of an item with increasing its value. Inefficient inventory practices at a warehouse, for example, could mean more man-hours spent in counting products and filling orders. This increases the price of the items, without increasing the value. Ask each level of the supply chain what kind of management practices they use.

Cloud-Based Inventory

We’ve talked about using the cloud for inventory in other articles on this site. Keeping your inventory updated in the cloud allows you to more accurately align your inventory with customer demand. There is software for cloud inventory that will track sales and changes in trends, alerting you to the need to reorder in time to meet demand. The analytics in the software will help you keep up with seasonal markets as well as other fluctuations in your area, such as conventions, concerts, sporting events, or other significant societal activities in your area.


Look for suppliers who use RFID (radio frequency identification) and tagging in their warehouse. This tagging is done at the manufacturing site and stays with the item to the point of sale. Stock levels in your supplier’s warehouse will be automatically monitored, and reorders placed when the stock reaches a certain level. In addition, the tags will guide employees to the precise spot in the warehouse, enabling your supplier to fill your order more quickly. A vendor who doesn’t have such technology on hand may become the weak link in your supply chain, eventually costing you customers.

E-Procurement Networks

B2B networks can educate and inform the small business owner about disruptions to the flow of products. A snow storm in Vermont may not matter to a health food store in New Mexico, until a shipment of specialty mushrooms is delayed. Business networks can acquaint you with the many levels of the supply chain so that you can plan ahead for disruptions. By predicting seasonal disruptions, for example, you may be able to avoid some of the fallout that accompanies disappointed shoppers.

Check Your Supply Chain Before Promotions

If you are planning a big sale, or promoting a new product, make sure your vendor has access to enough of the product. Let them know ahead of time that your volume of orders will increase, and find out how they plan to ship it. By alerting them of an increase in volume, you can avoid delays in delivery that could cost you important sales.