Liquor Store Inventory Management: How To Optimize Your Product Selection

Even the smallest liquor stores have a ton of different products. From champagne and tequila to hard seltzers and aperitifs, there is certainly a lot that liquor shop owners have to think about. Beyond those standard boozy products, liquor store owners must ponder all those non-alcoholic retail items, too – sodas, mixers, bundled kits, bar tools, etc.

This merchandising is certainly a major part of running a successful liquor store. Businesses must target their niche customers, respond to demand and utilize inventory management software to stay organized. In addition, powering smart promotions, and opening up sales to multiple channels will ensure cash flow and product movement.

Read on for an in-depth guide about liquor store inventory management and how to optimize your product selection.

Work With Powerful Inventory Management Software

The first and most important step for liquor stores to take is to invest in a modern, cloud-based, liquor store point of sale system. The point of sale does so much more than simply process transactions: it’s essentially the hub through which you run your entire businesses.

Inventory management is an indispensable element to the point-of-sale software package. Utilizing tools such as automatic ordering, optimized stock numbers, and product reporting help inform, illuminate and demystify all aspects of your inventory.

A modern POS should also provide actionable product performance and sales data with features like ABC analysis and various key performance indicators (KPIs). These features take away so much of the guesswork and deliver insights to liquor store owners so they can make informed decisions about their inventory.

Respond To Consumer Demand

Stocking the right amount means limiting your product numbers based on the demand of your clientele. At the end of the day, it makes the most sense to tweak your stock to cater directly to your customers. The goal is to reach that sweet spot where you have all of the products that your customers desire without holding too many items that are stagnant and tie up cash flow and inventory space.

Again, your POS reports are your ideal place to look for stock level predictability. Review your previous sales data to see what items you need throughout the year. Often, these numbers are affected by seasons, holidays, sporting events and other random trends.

You should supplement this data by keeping up to date with all of the latest trends in the industry. Be sure to read online magazines and blog posts. Try asking your customers what they like to drink, or getting feedback when regulars try new items at your store. Situating sales data and customer preferences within the bigger picture of the industry at large will steer you in the right direction.

Sync Your Omnichannel Selling

To maximize sales and keep up with competition, retail businesses should open up as many sales channels as possible. Many consumers do a large portion of their shopping online no matter what product they’re looking for, even if this just means seeing what’s locally available. Liquor stores are no exception. Building an eCommerce website where customers can browse your inventory and make purchases will increase your exposure and improve local SEO. Working with a delivery service like Drizly or MiniBar can further expand your reach.

This type of multichannel system can only work if you use a powerful inventory management program that syncs all of your product stock numbers.  With a perpetual inventory omnichannel system, you are tracking every action in real-time. In other words, each instance that you scan in items from your wholesale suppliers, execute a sale in-store, process a return or deliver a case of wine, your system will automatically update to the proper count.

Power Smart Promotions and Discounts

No matter how perfect you try to engineer and plan liquor store inventory management, you are bound to have some items that underperform. Unfortunately, these slow movers can be detrimental to a liquor store’s cash flow and bottom line. Not only do they tie up capital, they also take up space on your shelves and in your coolers. If you sell craft beer, you will even run into problems with expiring products.

Not to worry. That’s what promotions and discounts are for. By setting up well-planned sales, bundling products and doing in-store tastings, you can help move through this type of slower-moving inventory. Using your inventory management software will help show you exactly what items are lagging behind and what items are your best sellers.

In some situations, you can even use one to sell the other. For example, if you are entering the summer months and are having a hard time selling full-bodied red wines, try offering a bundled deal, like buy two bottles of rosé and get one bottle of red for free. Getting the full picture as to what is selling well, what is doing so-so, and what is lagging behind will equip you with more powerfully informed promotion and merchandising decisions to optimize your inventory.

Staying Informed Is Key

The most constant thread throughout all of these suggestions is keeping you and your staff informed about the flow of products in and out of your store. Knowing what is most popular at what times, reviewing patterns and predicting future demand will ensure that you have just the right amount of product selection for your clientele. Staying nimble and responding to customer demand will ensure that your liquor store inventory is well-stocked without dealing with waste and stagnant inventory.