How are your reorders?

Those who know me well will have heard me thumping this old chestnut a lot in the past. I’d have to say though, where this column is concerned, I’ve left the topic of reordering your fast sellers alone for quite some time. However nothing can last forever!

I was reminded of the importance of reorders (and the need to tell you about it again) by a recent chat with a client. They had heard me speak about reordering their fast sellers for quite some time, but the penny had never quite dropped.

The last time though something finally clicked. They “heard” the message properly and headed home to enthusiastically put it into action. Within a few months sales were up and the results were speaking for themselves. By restocking the best selling items they found themselves consistently making sales as these items came back in the door and headed straight back out again!

Their words were, “David, I know you’ve been telling us this for some time, and I believed you… I just didn’t realize the difference it could make!”

My delight was tempered by the fact that so many other jewelers are leaving profits on the table by not reordering their best selling items back in. Retail is a numbers game. A small percentage of your inventory is contributing a large percentage of your storewide sales. How much this is depends on your willingness to keep it on the shelf.

As a rough rule of thumb 20% of your inventory is responsible for 80% of your sales.

To illustrate using a store with 5000 items and $1 million in store sales:

The 1000 fast selling items (20% of the 5000 total items in store) is contributing 80% ($800,000/$1M) of the store’s revenue. In other words, there are only 1000 of the 5000 items sitting in this store that are generating most of the money coming in.


What would happen if when these items sold, they weren’t reordered? Let’s put it this way. If the bestselling car happened to be a Ford and your local car dealer doesn’t have any, will they sell as many of them as someone who does? The answer would be no. Yet every day many stores are suffering missed sales by not reordering those fast selling items.

Sadly, the typical store can often have under 10% of it’s inventory as fast sellers because they don’t reorder. Could a store sell more if it had more good product? If this store reordered its good sellers and built the ratio up to 20% or more then they could expect a corresponding increase in the dollars of fast selling items and hence an increase in overall gross sales. You know yourself when you are shopping if you don’t see what you like then you are unlikely to buy what you see.

So why not reorder? The reasons vary from, “I have tax to pay next week and can’t afford to” to “the customer who bought it doesn’t want to see someone else wearing it” to “the staff are bored with it.”

So ask yourself these questions:

  • If you don’t reorder and resell it, will you be able to pay that next tax payment that falls due?
  • If you stop carrying it to keep it exclusive, are the public likely to find it anywhere else? How about at your competitor’s store? Chances are your competition may pick the item up and guess where your customers will buy it then! Is your customer really going to see the item on someone else? I know a store in a town with 15000 people who sold the same diamond ring 46 times and has never once had a customer say they have seen it on anyone else!
  • Is your staff paying to buy the product or is it your customers? Who deserves the right to get bored with it first?

If you are serious about building your business, reorder those good sellers when they sell. It’s time to take your business to a new level

David Brown is President of the Edge Retail Academy, an organization devoted to the ongoing measurement and growth of jewelry store performance and profitability. For further information about the Academy’s management mentoring and industry benchmarking reports contact This email address is being protected from spambots. You need JavaScript enabled to view it. or call 877-569-8657.