We’ll Stock Whatever I Want to Stock

Most owners want employees to be assertive. We’ve all heard employers talk about the “self-starters” they need in their organization. As companies grow, an owner will naturally shift more responsibility to employees and expect them to handle more decision-making. Without proper supervision, even well-meaning employees can cause problems.
A recent small business supplement in the St. Louis Business Journal addressed this topic. Courtesy Vending is a $3 million business with 20 employees in Portland, OR. The business owns and manages more than 1,100 vending machines. Drivers pick up money and regulate each machine’s inventory- specifically the items stocked for sale in each machine. In 2001, the owner invested $60,000 in hand-held computers to track sales and product. He found that drivers were putting what they liked in the machines, with little variation. As the company started to vary the inventory, sales increased.
Beyond the driver’s personal preference, there are financial reasons for changing the inventory. Are certain products more profitable than others? (I’d pay up to get orange-flavored Ding Dongs: Are they still around?). Is a product more difficult to keep in stock? If there’s a shortage or shipping problem at the Beef Jerky plant, maybe we should reduce the number of machines with Beef Jerky displayed.

The Lesson: Properly managing staff is time-consuming and expensive. If an owner is willing to invest in methods to supervise employees properly, they may generate more profit over the long-term.