An EPOS stock control system tells you the difference between what you sold and what left the building. That gap is where your margin goes. For most independent retailers and hospitality operators it is somewhere between two and five per cent of turnover, and almost none of it is visible on a profit and loss statement until the year end, by which point it is too late to do anything about it.
Theft gets the headlines. The British Retail Consortium’s Crime Survey recorded 5.45 million shop theft incidents in its most recent reporting year, with shop theft alone costing retailers close to £400 million and a further £100 million lost to parcel theft. Retailers have poured more than £5 billion into prevention over the past five years, covering security staff, surveillance and better data collection.
But theft is only one entry in the stock loss ledger, and for a lot of businesses it is not even the largest one.
Shrinkage is the difference between recorded stock and physical stock. Four things cause it:
Only the first of these is a crime. The other three are process failures, and process failures are the ones you can fix this month rather than campaigning about for years.
Because a quarterly stocktake gives you one number, ninety days late, with no attribution.
You learn that you are £1,800 down. You do not learn whether that is one line, one supplier, one shift or one member of staff. By the time the count happens the CCTV is overwritten, the delivery notes are filed and nobody remembers the Tuesday in question. So the number gets absorbed into cost of sales and the same £1,800 disappears again next quarter.
Stock control software attached to your till changes the unit of measurement. Instead of one figure per quarter you get a variance per product, per site, per day.
It closes the loop between three events that are usually recorded in three different places: what you ordered, what you sold and what you have left.
Deliveries are booked in against the order. If you ordered twelve cases and eleven arrived, the discrepancy is flagged at the door rather than discovered six weeks later when the invoice is queried.
Every sale decrements stock in real time. Recipe and portion linking means that selling a burger removes a bun, a patty and a slice of cheese from the count, not just “one burger”.
Wastage is recorded as a transaction. A dropped plate or a spoiled tray is keyed in as waste rather than silently vanishing, which means wastage becomes a line you can review instead of a mystery.
Variance reporting shows you the outliers. If one product consistently runs short and forty others do not, you have a specific problem to look at rather than a general suspicion.
Products such as ICRTouch’s TouchStock run this on handheld devices on the shop floor, so counting, ordering and goods-in all happen where the stock is rather than on a spreadsheet in the back office. Our EPOS software page covers how the stock modules sit alongside the till.
Higher line counts make the problem worse, because a small percentage error across ten thousand SKUs is a large number. Barcode scanning at the checkout removes the single biggest source of administrative error in retail, which is the operator picking the wrong button for a similar-looking item.
When we fitted Taza Supermarket in Liverpool, the six-terminal setup included barcode scanning across the main checkouts and a shelf-edge label printer, so pricing on the shelf and pricing in the system stay in step. Mismatched shelf pricing is a quiet margin leak that most operators never quantify. More on the sector on our retail and supermarket EPOS page.
Bars lose stock differently. There is no barcode on a pint. Loss comes from over-pouring, unrung rounds, staff drinks and spillage, and the only way to see it is to compare theoretical yield against actual sales.
A cask that should yield 72 pints and consistently rings through 64 is telling you something. Whether that something is a line-cleaning schedule, a pouring habit or a till discipline problem is for you to work out, but you cannot start until the number is in front of you.
Tight till discipline also depends on staff not having a reason to work around the system. If ordering is slow, staff batch orders and key them later, which is where errors breed. Handheld ordering removes that incentive by putting the till in their hand.
Yes, and the numbers there are larger than most operators expect. WRAP puts the cost of food waste to the UK hospitality and food service sector at £3.2 billion a year, averaging around £10,000 per outlet. Its earlier sector research found that roughly 75 per cent of food waste in the sector was avoidable, with 45 per cent arising during preparation, 21 per cent from spoilage and 34 per cent left on customer plates.
Preparation and spoilage waste are both forecasting problems. If your system can tell you what you sold on the last four wet Tuesdays in October, you prep for that rather than for a busy Saturday. Sales history is the cheapest forecasting tool you own and most venues never open it.
Stock data tells you something went missing. Footage tells you how. The two are far more useful together than apart, because a variance report gives you a time window to search rather than hours of footage to trawl.
Modern systems can tie transaction data to camera footage so a specific void, refund or no-sale can be pulled up directly. Our CCTV systems page covers the camera options, and Lever Club in Port Sunlight runs EPOS and CCTV as a combined installation across their bars.
You cannot manage a number you have never seen. If your current till gives you sales but not stock, you are running the business on half the data.
Talk to CCR Systems about stock control across your tills. We have been supplying EPOS to retailers and hospitality operators in the North West since 1982, and we can show you what the reporting actually looks like on your product range rather than on a demo dataset.
