Your Strategy for Excess Inventory
There’s no doubt things look a bit different around your facility. As we all are adjusting to life after COVID shutdowns and regularly changing mandates, how can your redemption area keep up, too?
You’re probably stuck between wanting to update your stale prize assortment (because let’s face it, the same prizes have been on your wall since March) and not being able to invest in new items due to decreased budgets.
Your redemption prize selection plays a big role in making sure each guest has a great experience while at your facility. With household financials strained and families wary of public spaces, it’s important each person leaves your facility feeling satisfied so they’re more likely to come back.
We want to help you navigate this challenge. Here are a few quick tips to make your redemption space practical for getting rid of inventory from the first half of the year without breaking the bank.
1 | The most important to-do is to first do a full inventory system audit. Having old or bad data in your system causes countless operational problems. Whoever is in charge of your redemption inventory might have changed since March and/or it’s probably been a few months since you’ve gone through everything to make sure it’s correct. Starting fresh before you’re swamped again is a great way to ensure future success.
Clean out old items you no longer have in your space and to ensure your inventory number for each item is accurate.
2 | Now that you know what you have, you can identify the items you’re overstocked on. You can do this by checking your weekly usage reports, see how much of an item you have on hand. Your 4-week average is a gauge for what you have been going through.
We recommend having 1.5x merch quantity (bin items, high movers, and high end excluded). If you have more than that, and more than your usage quantity, that’s probably too much.
You’ll want to look at each item in your inventory. Knowing what is and isn’t performing well will help you know what items to markdown and get moved out, freeing up inventory space and budget dollars.
Take time to educate whoever is managing or buying the redemption inventory on the importance of COGs percentages and how this impacts the ebb and flow of your merchandise.
3 | Consider merchandising tactics + markdowns. By allocating a specific section of your wall or room for markdowns you can create an organized system for moving out old inventory. Move the underperforming items to this section and start with a 10% discount on the ticket value. From there you can increase the discount amount each weekend, or whatever cadence works for your business.
You can mark these items on sale by designating the selected area, or if the items are amongst the regularly priced prizes, use our Shelf Talkers. Our account representatives can send you some if you like.
4 | Create blind bags with smaller items. Bag an assortment of small items from your excess inventory into one bag. Calculate the average cost of the items, add a profit margin percentage and voila! Offer them as an upsell opportunity for your party program or merchandise them in your redemption space.
5 | Promote your marked down items through marketing. Share what you’re doing on social media and as guests are paying for game credits. Perhaps, tickets are worth double when they redeem from the marked down section. Or maybe you want to give away a free prize under 200 tickets from the marked down section with each redemption.
6 | As you begin to free up budget dollars and space in your redemption area, make a shopping list. We recommend focusing on the 250–1,250 ticket range in the post-COVID era. Some suggested categories to shop in:
- Create, Build, Learn — This science- and arts-focused category is great around the end of summer as kids prepare to go back to school.
- Outdoor — Of course, it’s still warm outside so hang on to some summer outdoor items as well. These are good to have in your prize assortment through October depending on what part of the country you’re in.
- Balls — This is always a popular category and can be used for redemption or cranes.
- Building Blocks + Sets: Redemption Plus just started selling LEGO®! Name brand items are a great way to draw attention to your prize selection and increase the perceived value of your display.
Remember to train and mentor your redemption staff. Your order cadence might be different than what it was in the first months of 2020. You also might have new individuals in charge of redemption. It’s important they understand buying best practices and inventory correctness.
We’re all navigating this challenging time together. If there’s a specific topic you would like to know about please let us know! If you need ideas on how to safely ramp up your redemption program’s performance post-COVID here are some ideas.
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