Saree Inventory Management: How to Avoid Overstocks & Shortages

Saree inventory management isn’t as simple as stocking up on popular designs and waiting for customers to walk in. With saree trends changing every season and customer preferences varying across regions, keeping the right balance of stock is no easy task. 

Too many sarees sitting on your shelves? That’s money locked up. On the other hand, too few when the demand peaks? You could be losing sales.

Whether you run a boutique or a large retail store, you must understand the flow of inventory to run a profitable saree business. Join us as we closely examine the common inventory challenges faced in this industry and share tips that can keep you ahead in the game. 

Understanding Inventory Challenges in the Saree Business

Managing saree inventory isn’t a one-size-fits-all job. Much like the sarees themselves, their inventory management is also layered. In this business, every little variation in a saree creates a new Stock Keeping Unit (SKU).

It’s the varieties available in saree that make the job more complex like Fabric types, Designs, Colors, Occasion, Drape or Finish.

When you take all these variations into account, you’ll end up with hundreds of SKUs at a time! Managing such a high number of SKUs is a challenge because:

• You need a higher storage space.
• Keeping track of what’s selling and what’s not becomes difficult.
• If any style goes out of trend, the risk of dead stock is much greater.

Without a smart inventory system in place, it’s easy to lose track of which SKUs are fast-moving and which ones are slow-moving. As a result, you might end up overstocking slow-moving styles and running out of popular ones.

Common Causes of Overstocks and Stockouts

Overstock and stockouts are the two great evils of saree inventory management. Sometimes, your racks are overflowing with unsold sarees. Other times, customers walk in asking for a particular design that’s already out of stock.

But why does this happen? The causes behind overstocks and stockouts usually boil down to these few common mistakes: 

Lack of Demand Forecasting

As a saree retailer, one of the biggest mistakes you can make is to purchase stocks without forecasting demand. Instead of relying on data, many businesses prefer to go with their gut feeling, which translates to:

• No analysis of past sales trends
• No planning for peak seasons
• No idea which fabrics or styles are in demand

Not relying on demand forecasting is like flying blind in the industry; you’re more likely to take a hit rather than soaring high. 

Overbuying New Collections Without Understanding Sales Velocity

New collections are exciting for all saree retailers. But they’re also risky, especially when you’re:

• Buying large quantities without testing
• Not tracking how fast each SKU is selling
• Assuming all trending styles will sell quickly

Remember that not every new collection is a hit with the customers. Without tracking sales velocity, you could be stuck with stock that just doesn’t move. 

The solution? Always test new collections in smaller quantities first. Observe which ones pick up fast. Reorder based on demand, not just on how pretty the designs look.

Ignoring Market Trends and Consumer Behaviour

Today, the saree industry is just as fast-evolving as any other fashion industry. Thanks to the internet, your prospective customers are not only well-informed but also very picky. For your saree business, it means:

• Style preferences change every season.
• Influencers and social media impact buying decisions.
• Comfort, fabric, and even sustainability are growing concerns.

If you’re not tuned in to these shifts, your inventory will quickly feel outdated. 

To fix this, saree retailers should attend more exhibitions and trade shows, follow fashion influencers on social media, and talk to their regular buyers. 

Your inventory should reflect what your audience wants today, not what sold last year.

Learn more about the importance of consumer behaviour here.

The Importance of Accurate Saree Demand Forecasting

As we’ve established so far, guessing doesn’t help your saree inventory management; planning does. Accurate demand forecasting helps you stock the right sarees at the right time and in the right quantity. 

It reduces overstock, avoids missed sales, and keeps your cash flow healthy. Here’s how saree retailers can get it right:

Analysing Past Sales Data

Your past sales will tell a story if you know how to read it. To analyse your past sales data, you need to:

• Check what sold last year during the same month or season.
• Look at which fabrics, colours and price ranges were popular.
• Track sales patterns for each collection and customer segment.

Once you start using this analysis to plan your future purchases, you’ll have a much better idea of which sarees are your top performers and which ones flop.

Factoring in Festive Calendars & Wedding Seasons

The demand for sarees is heavily tied to festivals and weddings in the Indian market. Here, timing is everything.

• Diwali, Durga Puja, Pongal, and Eid drive festive sales.
• North and South India have different wedding seasons and cultural peak times.

Be it weddings or festivals, buyers start shopping for them weeks in advance, and so should you. 

Refer to the cultural calendar for your stock planning, and prepare early for wedding peaks and festive surges to maximize sales.

Using Regional Insights

In the diverse Indian market, saree preferences change from state to state. The one-size-fits-all approach is less likely to succeed in this market. 

• Banarasi and Chikankari sell better in the North.
• Kanjeevaram, Mysore Silk, and soft cotton sarees are preferred in the South.
• Even border designs, blouse patterns, and colors vary by region.

A better knowledge of your target audience and their regional tastes can come in handy in smart stocking. That way, you can keep your collections relevant and your shelves moving. 

Learn more about demand forecasting in the fashion industry here.

Inventory Management Techniques for Saree Retailers

Here are four powerful saree inventory management techniques you must know as a saree retailer:

ABC Analysis

This technique is about grouping your stock smartly because let’s face it – not all sarees sell equally, and that’s alright. Here’s how it works:

• Put your best-sellers in the A category – the ones with high demand and, in turn, high profit. This is the category where your attention (and investment) should be focused.
• Put your moderate-performing collection in the B category – the ones that sell decently, just not as fast.
• Put your slow-moving pieces in the C category – these are the ones you should keep a minimal stock of (and avoid over-ordering).

Now that your categories are defined, prioritize them in the same order to help improve your sales and prevent the wastage of resources.

Just-in-Time (JIT) Inventory

The JIT helps you stay lean by minimizing inventory on hand. It states that you should practice ordering stocks based on actual or expected demand, and not stock up months in advance. The technique:

• Works well with fast-selling collections and regular suppliers.
• Reduces your storage costs.
• Prevents overstocking.

However, this technique can only benefit you as long as you work in close coordination with your vendors and are tuned in to the customer demand. 

Safety Stock Strategy

In the saree business, it is not unusual for the demand for certain sarees to shoot up unexpectedly, be it due to an influencer trend or a last-minute bulk order. 

Having a safety stock comes in handy during such times. It involves keeping a small buffer of your best-selling sarees. Here are its benefits:

• It acts as a backup plan during peak times.
• It helps you meet sudden demand without panic buying.

First In, First Out (FIFO)

In the saree business, old designs can go out of fashion fast. To prevent that from resulting in your losses, include FIFO in your sales strategy. 

It dictates that retailers sell out their older stocks before the new stock hits their racks. FIFO not only helps you avoid dead stock but also keeps your inventory fresh. 

How Tapobhumi Manages Saree Inventory Across Multiple Brands?

If managing inventory for a saree retailer can be a challenge, it calls one to imagine what 

it must be like for a fashion house with six brands under its umbrella? Tapobhumi houses six brands, Julahaa, Tana Bana, Charkha, CHPYI, Kshedaa, and Label-Z, and handles this challenge seamlessly.

The secret to Tapobhumi’s expert saree inventory management lies in smart inventory planning and execution. Here’s how they do it:

• Catalogs are released strategically before peak seasons.
• Production is guided by demand forecasts, not guesswork.

With its clear understanding of what sells, when, and where, Tapobhumi sets a golden standard for saree inventory management. 

Whether you’re a boutique owner or a saree wholesaler, there’s a lot to learn from how Tapobhumi keeps its six brands running like clockwork.

‘Tapobhumi’: India’s Powerhouse for Indian Ethnic Fashion

Designer sarees are an investment. At Tapobhumi, we bring this investment within your reach, offering designer-level sarees that are best in their respective segments.

Whether you’re looking for something traditional or modern, our sarees offer the perfect blend of artistry and personal preference.

And what are designer sarees if not pieces of wearable art?

This concludes the blog on ‘Saree Inventory Management: How to Avoid Overstocks & Shortages.‘

For business enquiries, visit https://thetgncompany.com/

For social updates, follow us on Instagram @maisontapobhumi

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