Read to find out everything you need to know about retail audits.
Store audits are an efficient way to track how your retail business is doing, whether you operate in one location or a multitude.
It’s important to keep your inventory up to date, so you’re presenting the best possible version of your business. Ensuring your inventory management tasks are completed on time is vital, which is where store audits come in, as they provide deep insights into the organisation of the business.
These days, store audits have assumed a new role in retail businesses, providing more in-depth insights than they ever used to.
However, newbie retailers who aren’t familiar with store audits can find the task intimidating.
Below, we look at what a retail audit is, its advantages as well as tips on completing one successfully, so the process is made super simple.
What’s a Retail Audit?
Fundamentally, a retail audit evaluates the condition of your retail location using hard data. Vendors, employees or a third-party scrutinise your store or pop-up shop to gather information on what’s selling well and what isn’t.
Often, retailers use profits as their main method of measuring success, but when you carry out frequent store audits, you have a lot of extra analytics that provide a broader picture of what state your business is in. There are a wide range of areas an audit can focus on including, but not limited to, merchandising audits, competitor pricing audits, inventory loss audits etc.
During a retail audit, you’ll uncover insights such as:
- Damaged products
- Stock levels (including stock on your shelves and stock out the back)
- Sales volume
- An outline on what your competitors are doing
- Calculations on visual retailing and in-store presentations
- Position of shelves, quantity of frontings, amount of SKUs available, misplaced/incorrect shelf tags
- An insight into your pricing scheme
- Where the products are positioned in store
Bear in mind you’ll also have to select the kind of audit that harmonises with your requirements most.
Take a look at the different kinds of store audits available:
- Marketing audit: This type of report studies customers for their reaction to your brand, understands how pedestrians interrelate with your business, giving you a more accurate insight into what other businesses of a similar niche are up to.
- Merchandising audit: Collects your entire stock information. Features stock quantities, efficiency of your merchandise costing, how merchandises are presented, the effect of your present visible marketing and merchandise campaigns.
- Asset protection audit: Highlights whether your existing prevention plan is effective, which items are stolen more than others, the location of those items in your store and what schemes are successful and which ones don’t work as well.
How often you perform a retail audit depends on the variety you opt for and your objectives. Whether you need to carry out a swift inspection each month or an in-depth audit once every quarter, be sure to think carefully about the possibilities and erect a system tailored to your retail requirements as well as your assets.
What Are the Advantages of a Retail Audit?
Not only do retail audits teach your staff more about the daily running of your business, they also:
- Uncover and solve irregularities when it comes to in-store displays, visual marketing and brand compliance
- Offer a structure from which to calculate financial metrics, KPIs and team performance
- Detect store-level issues, like operational problems and maintenance
- Pinpoint training requirements
- Find best practices to share with other stores/areas
- Execute and devise new in-store techniques and practises
- Strengthen relationships with your most important asset – your store managers and acquaintances
- Nurture positive competition between your stores
- Close the gap on task management, guaranteeing prior duties and actions have been fulfilled.
How to Perform a Store Audit Effectively
In retail, auditing a store is a critical action for the correct functioning and organisation of the business.
Here are some pointers on how to perform one successfully.
- Organise Your Store Audit
It’s important to plan ahead so your store audit can be completed with minimal interference to the customer experience.
The optimal time to perform audits is during slow times when you have plenty of employees to successfully complete the audit while being able to maintain everyday business.
Another suitable time to carry out the audit is when the store is closed, but the issue with carrying out an audit outside of business hours is that it’ll involve arranging additional resources.
- Ascertain Your Objectives
Before you begin your audit, make a list of goals. Consider what you wish to achieve alongside what areas you feel will need additional attention. Do your in-store displays look good enough? If not, then make sure you take the time to inspect each display.
And remember to include the exterior of your building in the audit, too. After all, this is what customers look at first – and it can make quite a first impression on potential customers as they walk through the door. Small things such as overflowing rubbish bins and a burnt-out light can have a real impact on how someone views your business.
- Take Comprehensive Notes
During the auditing process, don’t forget to take notes as you go – or ask the third-party retailer carrying out your audit to. It’s also a good idea to take photographs as you go, recording the audit results, so you can evaluate the before and after pictures of the fixes as they’re made.
- Assign Tasks to Employees
Don’t be shy when it comes to delegating fixes to staff once the audit is complete. As soon as your resources and budget permit, delegate tasks to employees, contractors, or external agencies. Although you may not be able to fork out on any changes until the next quarter, scheduling it in the books guarantees nothing is lost or left to build up until the next arranged audit.
Joemar Carillo is a content writer for Assosia. She has written for a variety of sites on technology, business and marketing.