Do you know What the Last 100 Yard Problem is?
Do you know What the Last 100 Yard Problem is? It is probably costing you!
Do you know what the Last 100 Yard issue in retail refers to? If you don’t, you may need to read on as current research determines that it is one of the common issues with retailers and hinders small retailers in becoming profitable. You cannot sell what you don’t display. More importantly, you cannot display what you cannot find! Regardless of how great your point of sale system or inventory management technology is, a lack of logistics strategy within your retail store will render the technology useless. Trying to automate an inefficient inventory management process will only magnify the inefficiency, which is why it is imperative to develop an inventory management strategy that begins with merchandise reception in the backroom and ends in the sale of your products, which leads to product re-ordering (replenishment).
The Last 100 Yard issue refers to the problems that occur by the mismanagement of product from the backroom to the shelves or gondolas. Such issues cause inventory inaccuracies, increased holding costs, lost sales, among others and include misplacement of product in the backroom, mislabeling of product, and mismanagement of the reception process. Notice that although all of these problems can be better managed by the incorporation of technology, the solution first needs to involve the creation and implementation of a business process. A business process is a standardized set of activities to accomplish a specific task.
Organizations like Wal-Mart are experts in logistics and efficient business processes. Such organizations understand the importance of creating effective procedures and invest in the development of strategy that leverages the power of automation technology to lower costs, increase productivity, and generate efficiency. This translates to improved profitability and, when done properly, can create competitive advantages. They understand that it takes more than an investment in technology to reach their goals. Technology must align with organizational strategy for successful outcomes to be obtained.
Ask yourself, “Do I have efficient and manageable procedures in place for the management of product movement within my store?” “Do these procedures align with my information technology infrastructure?” Really analyze, reflect, and constructively criticize your processes. Once you do this, you will notice that there is always room for improvement. My next article will delve into the steps that you can specifically take to eliminate the Last 100 Yard issue, followed by another article that will introduce the automation of your business processes to increase efficiency of backroom operations related to the 100 Yard Problem.