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Merrick, NY—Our third installment of "One Smart Thing" features Dan and Lori Askew, Vantage Group, a company providing strategic, analytical and operational consulting assistance to motivated jewelers looking for results. Their topic is inventory management.

The Centurion: What's ONE smart thing a prestige jeweler can/should do to start off the year right?

Dan and Lori Askew: Manage the three tiers of inventory management. There are a number of critical components in a jeweler’s business that make up the overall health of the company.  Each of these pieces not only plays a part, but also must work in concert with one another to create a strong business. As the fourth quarter passed you sold almost as much inventory as you had in the previous three quarters combined.  This massive turnover of product and your remaining inventory assortment calls for your attention to rebalance for the upcoming year.  Inventory balancing is a three-tier approach:

• First, give attention to payables.  Vendors supported you by extending terms, be sure to support them by making good on your payment schedules, which will help future relations.
• Secondly, replenish your fast selling merchandise or you will be moving into Valentines and Mother’s Day only with the left over goods from the holidays.
• And the third tier is to plan your cash flow for the upcoming year. Inventory requires the largest portion of cash flow. By establishing your cash flow, you start the year fresh and with confidence in knowing your inventory levels will support your sales goals, and your income will support your financial commitment.

By following these three steps in giving attention to your inventory you will start off the year headed for success.

Missed the first two installments? Click here for Jon Parker on Personnel and Ellen Fruchtman on Marketing.