The stats for Connie are out and the entire team is shocked. However, we want to talk about this staggering number – 406. If you’ve started tracking your supplier invoices, you should. You might be surprised at how much it is costing you not to check.
Connie clocked an average of 406 changes by suppliers for our customers in the price of their goods during their busiest season of May through August. That means that over the summer, each of our customers received an alert about a change to 406 items in their store.
That’s a huge number. Sure, it scales based on the size of our customers… but in my tiny 12×12 store in a town with around 200 people, we processed 86 supplier invoices and received 170 alerts last summer. No wonder we weren’t keeping up. And I’d so much rather be developing new programs or finding new products.
Let’s be fair to suppliers because they do a GREAT job for us. Many of those were decreases! However, we thought it was important to point out the money it costs to NOT track these supplier changes…
- Discounts that were missed
I’m not blaming my supplier or my delivery drivers. But sometimes they enter the wrong code or forget things and my discounts get missed. Little $5 and $10 discounts here and there. Now, missing one or two of these doesn’t seem like a big deal. But in some cases, we noticed that one or two of these were getting missed on one or two of our packs every single time. This adds up fast.
- Slow-rising prices
This one was very sneaky. Normally, we wouldn’t notice these. For small fluctuations we don’t typically adjust prices. Which makes this one particularly damaging. One supplier was slowly raising the cost of tobacco by just a little bit each week. Less than a dime, but by the last time we checked the alert and opened up the trend report, the margin was shrinking pretty steadily and we had to make an adjustment. This is something in the summer months we never would have noticed because we are just too busy.
- Major increases, one as high as 98%
We had a lot of hard conversations about this one. It wasn’t a big item, nor did we sell a lot of it. Really just a few a week. But with this alert came after other alerts for similar products with pretty high fluctuations of change. And frankly, we would have lost a few dollars every week on this item alone if we hadn’t noticed it. I don’t know about you, but in a tiny store… in a tiny town… we care about nickels and dimes. We were able to use our trend reports that Connie puts together to have a frank conversation with our delivery service about the slowly rising prices… and this time with proof!
- Supplier Specials & Pricing Patterns
Sometimes it isn’t their fault. Sometimes it is just that I cannot keep up with all the supplier discounts. It’s so nice to have a mobile alert remind me when something comes in different than it was the last time. I want to have great relationships with my suppliers. We appreciate them so much! So it is really nice to start building trust together.
What did the knowledge of all these price changes bring? An average increase of around $200 a month and 80 fewer hours reviewing supplier invoices. That’s a small car payment! The money is nice, but the time and peace of mind is the REAL value to this little store.
With Connie, we did nothing to get this information. We instructed our cashiers to simply send the invoice through a document scanner to Connie instead of just tucking it in a folder for us. Those extra hours we saved were spent starting up new programs and developing better operational processes. Things we’d rather be working on anyway; things that help us make money. Connie catches more than we do, she’s incredibly reliable. Our peace of mind and free time is really worth it. The extra bonus… tax time and accounting was much easier. When it came time to get my cost of goods by category, we just gave our accountant access to our Connie reports. Not keeping track of our item expenses was costing us money. Connie put it back in our pocket.