Those of us who have managed retail departments understand that when the product is fresh it is also perishable. The winning strategy is to sell through the product with margin before it loses its freshness. When product gets old and must completely be dumped, it is a total waste. When it is sold at a reduced price and margin is lost, it creates shrink.

Shrink is measurable, but not all department managers understand the vital importance of measuring it. They are unaware of the facts while knowing it exists. This is not a good posture when operating a department. Ignorance is not bliss. In this instance, fear drives the strategy, so excessive margin is built into the markups to compensate for the waste losses. If one overcompensates, a downward spiral will occur that decreases sales resulting in less inventory turnover which increases the shrink. You get the picture.

A winning strategy is addressing the pain points head-on by identifying, monitoring, and controlling the shrink. This may mean resetting the product to a different location or cross-merchandising it to stimulate the movement. Educating the consumer on how to use it, how to prepare it, sampling, or telling the story of origin also helps in moving the product.

Packaging tactics to fit your strategy are also essential. But all this starts with measuring and knowing the facts about the department and the items. Do you know your shrink? How do you know? Surely you are aware of the waste.

Hitting the mark has always been the goal. Ancient archers had to learn how to aim without sights. This skill  —  called instinctive shooting  —  requires years of trial and error to master. Through consistent practice, the body and mind intuitively learn how to adjust the aim of the bow to accommodate different shooting distances.

Instinctive shooting is a lot like throwing a baseball or shooting a basketball. Once you’ve practiced these skills, you don’t really think about aiming when you throw a baseball to someone or shoot a basket. You just do it. Your mind and body are able to calculate the right angle and force you to throw the ball and ensure that it hits the target or at least gets very close.

Not all departments are operated by seasoned workers who have many years to become instinctive. During these days of labor shortages, most retailers don’t typically have their stores staffed with team members who have had “years of trial and error to master the process.”

So what’s the solution? One approach is to engage artisan professionals that can help you identify the path to the best practices. Sages can lead by helping you develop standard operating procedures that will be carried on by each replacement. In these fast turnover days it makes sense.

Engaging seasoned experts may be as simple as contacting the editors of this publication for a referral or checking with a trade association. Those artisan professionals can help you put into place standard operating procedures to consistently measure shrink and adjust accordingly. The cost will be a path to freshness "on purpose."

When calculating the cost of waste-learning processes, you will find that the education is by far the best value.

Hitting the bull’s eye (the mark) in sales-per-employee hour, gross profit percentage, and positively impacting the entire store image must happen one fresh department at a time. It all starts with doing the basics extremely well.

As Admiral William H. McRaven said in Changing the World by Making Your Bed, "If you can’t do the little things right, you’ll never be able to do the big things right.”
Go into action today because freshness doesn’t just happen, it must be reached on purpose.

Anthony Totta is the founder and CEO of Independence, Missouri-based FreshXperts LLC and the founder, CEO and produce consultant for Grow My Profits LLC. Totta has more than 35 years of experience in entrepreneurship, management and business planning.