How Do Grocery Stores Keep Track of Inventory?

Inventory management refers to the invisible processes behind how a business empties and restocks its products. In previous times, businesses kept track of how much stock they had manually. That meant using the pen and paper method. They would count their products individually and then document day-to-day sales and restocking on paper.

With the creation of Excel spreadsheets and intelligent Inventory Management Software, keeping track of stock levels has never been easier. Inventory tracking saves businesses from over and under-stocking, which can cause business losses.

So how do grocery stores track inventory to avoid these losses? In this article, we’ll answer that question.

How grocery stores track inventory

Most grocery stores use Inventory Management Software to track their stock levels. An Inventory Management Software is simply an application that can be installed and run on a computer. This software allows the grocery store to closely monitor how products come in and out of their stores and warehouses.

Here’s a visual breakdown of how the inventory management process cycle moves:

At a physical store

  • A customer shops for items and drops them in the store cart. E.g., barbeque sauce, mustard, capers, etc.
  • The customer presents their selected items to the checkout counter for payment. 
  • A cashier scans the Store Keeping Units (SKU) of the customer’s selected items. Scanning SKU allows the software to remove customer item quantities from the store’s total inventory level. This will help store personnel with access to the software know when products are running low or out of stock.
  • The inventory management software generates a restock list. Some software may go as far as routing orders to the grocery store’s suppliers. This will notify the suppliers to deliver more products.

Online shopping

  • A customer places an order on the grocery store’s website.
  • The website is connected with the Inventory Management Software. So after making payment, the Inventory Management Software automatically generates an invoice or receipt.
  • The software sends the receipt to the customer via email.
  • Store personnel view the invoice and prepare the customer’s order for delivery.

Some intelligent software grocery stores use to monitor and track inventory levels include:

Does Inventory Management Software catch grocery store shoplifters?

Inventory Management Software does not help grocery stores to catch shoplifters. So grocery stores can’t depend on it entirely to prevent business losses.

Stores like Walmart track shoplifting by equipping their staff with handheld scanner devices. These scanners look like and work like smartphones. In addition, the scanners are integrated with self-checkout counters. This allows staff to view customer purchases in real-time.

So if a customer scans an item, cancels it from the self-checkout screen, and then bags it, the staff will know. Grocery stores also use Radio-Frequency Identification (RFID) tags and sensors, as well as security cameras, to catch thieves.

But even with all these tools at hand, grocery stores still track their inventory manually. However, they don’t do this frequently as it’s time-consuming and requires planning.

How often do stores check inventory manually?

How often grocery stores check or track their inventory varies. It depends on the store. Some stores do a thorough manual count of items once a year. This means that store employees go around the store counting items on shelves. 

Other stores count their inventory bi-annually, which is twice a year. However, grocery stores typically plan ahead of the count. So before it is to take place, the store managers must have informed other employees about it. 

Female grocery store staff with red hair looking at shelf while holding a tablet

Some stores may decide to close on the chosen day for the count. If this is the case, the store notifies its customers via emails. Other stores may not necessarily close off for the day. Instead, they would initiate the count after business or peak hours.

Key takeaway

  • Grocery stores track stock levels with inventory management software.
  • Inventory Management Software helps grocery stores prevent business losses incurred from over and understocking.
  • Grocery stores can leverage inventory management software to streamline their inventory management process. Such software includes Zoho inventory, inFlow, Upserve, Ordoro, and Cin7.
  • Most grocery stores still check their inventory manually, even while having technological systems. This happens once or twice a year.

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