Finding the sweet spot

Departments - Straight Talk | Honest insights from an IGC expert

Take the fear out of buying and inventory management with these tools and strategies to make profitable decisions.

September 8, 2020

Buying and committing to inventory … it is one of the most important functions of a successful garden center. Yet not all IGC buyers have the training or tools to make smart buying decisions based on hard data and solid marketing strategies. Too often, a lack of buying protocols and promotions leave you with bad buys based on fear.

By giving your buyers the right inventory management and buying strategies, you can take the guesswork out of purchasing and boost your GMROI.
Your inventory is your garden center’s biggest expense. If you have too much inventory, it reduces your cash flow, your inventory turns and GMROI falls. Excess inventory becomes a drain on your business and you may end up having to ditch it or put it on sale. Buy too little inventory, and you will lose sales and damage your perception of value with customers. The right amount, and type, of inventory is that just-right bowl of porridge Goldilocks was hunting for. So how do you find the right balance?

Stubborn staff

As a garden center buyer, you deal in at least 50% live perishable goods. Plants have a shelf life. So do hard goods, for that matter. Unfortunately, many of your plant-loving sales staff (and buyers) do not see it that way. They will leave those flats of two-week old petunias, stretched and gasping for their last breath of life, on that bench forever, convinced someone will eventually buy them. This emotional resistance to ditching unsellable plants will kill your annual revenue and your GMROI, and make you look bad to your customers. No one came to your garden center to buy chlorotic petunias. No one. Let them do that at the big boxes.

A refusal to ditch bad product, and a fear on the part of the buyer to spend more money to quickly replace it with fresh new stock, is one of the most common IGC inventory issues I encounter. If buyers are just refilling benches as they visually empty without incorporating sales data, that is also going to significantly hinder your success.


Are you training?

Here are a couple of questions I will throw out at you: Are your buyers trained in how your P&L and GMROI work? Are they trained in how to track and run meaningful sales data? Do they use an open-to-buy? Are they included in marketing and promotions planning for all buys? If your buyers are basically garden floor staff pulling double duty as category or department buyers, then I suspect the answer to all or some of these questions is “no.”

I have worked with great, knowledgeable plant people who have years and years of retail garden center experience. Yet, despite their extensive horticulture and operational knowledge, they still had little understanding of how to buy inventory strategically based on the numbers and marketing. Their trial-by-error based approach of buying left them fearful of buying aggressively when needed and resistant to cutting inventory when necessary. If you are in this situation with staff, you need to commit to retraining them as buyers, not just plant enthusiasts. That takes tools.


One of the most powerful tools you and your buyers should be using is a retail open-to-buy system (OTB). An OTB is a super simple, yet magical, tool (in my opinion) that guides you on what you need to spend (or not spend) each week on inventory to hit your target sales goals. OTBs help you forecast your end-of-the-month sales based on current sales and inventory numbers. Based on how sales are going and where current inventory levels sit, you can quickly adjust your spending. Without an OTB, you may spend far too much or far too little. Essentially, OTBs take the fear out of your buying decisions, replacing it with knowledge.

OTBs are only as good as your up-to-date inventory and sales data. If you are not properly tracking existing inventory, write offs and sales data, then you cannot forecast inventory spending needs appropriately. So, it may require some logistical housecleaning on your part before you can effectively deploy an OTB with your buyers.

Sell before you buy

Good buying also does not happen without good marketing strategies and advance promotional planning. The best way to be able to go deep in inventory, or book much bigger buys than you have committed to in the past, is to have a plan for how you are going to sell it before you buy it. I am a big fan of committing to pre-ordered bookings before the product’s sales season. Pre-bookings give you time to plan marketing and promotions in advance, and sell your customers on the product before you even receive it.

If your marketing and buying teams are working closely, marketing may have great ideas for promotions that will better guide buying decisions.

The only way you are going to make more profit per square foot of inventory space in your garden center, is to turn more inventory in less time at a better margin. That takes skilled and attentive buying, not guesswork. And certainly not fear.

Leslie (CPH) owns Halleck Horticultural, LLC, through which she provides horticultural consulting, business and marketing strategy, product development and branding, and content creation for green industry companies.