"Be a Winner”
Despite the Recession-Part II

Part II: Vendors Role Optimizing Business Performance

Use Vendors to Improve Operational Performance
During a recession vendors are more than just a source of product; they are also a means to improve operational performance, especially if you have the right information about what you need.  For instance, vendors are facing the same sales problems as you, and need business now, so don’t hesitate to request to exchange slow sellers or negotiate lower prices for essential products, even if that means paying for the goods earlier.  Also, restrict buying; don’t buy goods you don’t need, because the terms are good, but place orders for best sellers early and scheduling weekly deliveries according to your sales plan.  If your sales plan is too high, push deliveries back into the summer.  On the other hand, if your sales exceed plans, ask suppliers to carry backup inventory, tag products, and drop ship to stores to keep sales growing and reduce carrying costs if that will support your long term plan to reduce costs. 

What's more, there’s a lot of excess inventory in the pipeline today.  That can drive retail selling prices down, but it’s also an opportunity to do consignment deals.  However, memo isn’t free.  If not executed properly, it can cannibalize the sale of the merchandise that you already own, reducing working capital.  So study your sku level inventory reports and your match consignment goods to your OTB.  That way you can finance essential purchases off balance sheet, and pay for the goods when sold....