Macy’s Inventory System Keeps Costs Down

Great news! Thanks to Macy’s inventory system, the clothing retailer enjoyed another solid quarter, despite significant challenges. Macy’s same-store sales were hurt by poor weather in the third quarter of 2010, but that didn’t stop the company from improving its bottom line.

Money in a vice, Fishbowl BlogAccording to the cleverly titled article “Macy’s Parades Market Share Gains,” Macy’s “Gross margin of 39.94% increased 13 basis points year-over-year as the result of improved inventory management (days sales of inventory (DSIs) are down 3% year-over-year).”

Even though the article has a creative title, its body is dry and hard to penetrate. I’ll do my best to spare you the frustration by putting my personal mark on it.

For instance, the article includes the following sentence: “Inventory increased 1.9% year-over-year, but grew 250 basis points slower than sales.” What is a “basis point”? It’s one one-hundredth of a percent. So the author could have just said that inventory grew 2.5% slower than sales.

No matter how you say it, this is great news for Macy’s. The goal of every retailer should be to run efficiently, which includes cutting inventory to its optimal level. Macy’s has found a way to consistently meet demand and keep customers happy while also reducing carrying costs by cutting their inventory levels.

How does Macy’s accomplish this feat? With inventory software, that’s how. By using inventory software, you can figure out how much inventory you need during different seasons, such as the upcoming Christmas shopping season. That way, you don’t waste time waiting for products to show up and you also don’t hold onto more products than you need.

Follow Macy’s example and start enjoying all of the inventory management tools that this retailer enjoys.

About Robert Lockard

Robert Lockard is a copywriter with Fishbowl. He writes for several blogs about inventory management, manufacturing, QuickBooks and small business. Fishbowl Inventory is the #1-requested inventory management software for QuickBooks users. Robert enjoys running, reading, writing, spending time with his wife and children, and watching movies. His favorite movies include Mr. Smith Goes to Washington, Fiddler on the Roof, Back to the Future and Lawrence of Arabia.
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5 Responses to Macy’s Inventory System Keeps Costs Down

  1. Pingback: How to Manage Your Inventory Like Big Companies | Fishbowl Inventory Blog

  2. Pingback: Inventory Tracking Brings Dillard’s Back from the Brink | Inventory System Software Blog

  3. Pingback: Downside of Good Inventory Management: Fewer Outlet Stores | QuickBooks Manufacturing Blog

  4. Pingback: Macy’s Sales Rise Thanks to Smart Inventory Management | Inventory System Software Blog

  5. Pingback: Downside of Good Inventory Management: Fewer Outlet Stores | QuickBooks Manufacturing Blog

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