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Introducing the Insights Inventory Dashboard

Jul 5, 2020

Tired of constant inventory challenges or want to understand how inventory moves through a market? We’ve built a dedicated inventory dashboard to help you manage inventory effectively and understand inventory trends in the market to predict changes and capitalize on opportunities.

The dashboard provides information on the median weeks carry and the average value of inventory at the category level in each market. Using this dashboard will help Headset users better understand how to stock their stores, how to forecast brand level sales, and how to prepare for events like 4/20 or drastic market changes similar to COVID-19.

What is it?

The Inventory Dashboard will help our customers gain a better understanding about the levels of inventory currently in the market at the category level. In addition, customers can do trending analysis to understand if inventory level are growing or shrinking over time.

We focus on two main measurements: (1) weeks carry and (2) value of inventory. Headset users can use these to understand how long inventory levels will last as well as determine the current retail value of inventory.

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cannabis-inventory-metric-trend

How does it help you stay ahead?

Inventory headaches slow everyone down and lead to losses in revenue and time. The purpose of this dashboard is to give Insights Premium users the ability to review the inventory in the marketplace and get ahead of future sales changes.

Until now, Insights has only provided information on sell-thru product sales. While sell-thru is a great proxy for sell-in, the two numbers aren’t always perfectly correlated. We’ve built this new dashboard so you can gauge how inventory level change both seasonally as well as over time. There are critical questions which can only be answered with sell-in information and this dashboard sets out to begin answering these important questions.

Questions you can answer with the new dashboards

  • Are inventory levels climbing and should we expect to see inventory purchases decline in upcoming months?
  • As retailers prepare for the holiday season do they make inventory purchases in late Q3 and thus we would see boosted brand sales in Q3?
  • Are inventory levels declining rapidly and should we anticipate stock-outs?
  • Are my stores stocked normally? Are there places where I could reduce my inventory levels to free up working capital?
  • How soon does the typical retailer stock up for 4/20 sales?

How does it all work?

Just like all our Insights data, the Inventory Dashboard data is sourced in real-time from our participating retailers. Find everything in single dashboard that provides the Insights Premium users with the ability to compare data by state or by market.

To get the most out of these dashboards, you need to fully understand these two new measures we’re adding into our Insights platform.

  • Weeks on Hand: the number of weeks it would take to sell through all the inventory currently available (at current sell-thru rates) without replenishment; it represents how long a retailer could go without reordering before they ran out of inventory.
  • Formula = {Total Units in Inventory}/{Total Units Sold in Prior Week}
  • In this case we define “current sell-thru rate” as the sales in the week prior. For example, if you are looking at weeks carry on 9/4/19, we would be comparing the typical units on hand on 9/4/19 to sales during the week of 8/28/19 to 9/3/19.
  • Value of Inventory: this is the number of units in inventory multiplied by the average item price in that category; it represents the total revenue a retailer would recognize if they sold through all of their inventory.
  • Formula = {Total Units in Inventory} X {Average Item Price}

Other key pieces of information about how these dashboards work:

  • Weekly Data: We calculate this data one time per week. Intra-week fluctuations are more random and don’t give a good picture of trends over time. For this reason, we have chosen to calculate inventory levels based on Sunday morning’s inventory and compare that to sales in the Sunday-Monday prior. Data is updated on Wednesday mornings to reflect the start of the current week.
  • Market Availability: As this data does not rely on forecasts, but rather reports the descriptive statistics for a typical retailer, we report this data in real-time for all markets (including Canada).
  • Category read only: This deepest level you can go to currently is the category level data (you cannot drill into brand, segment, or package size at this time).

This dashboard displays information for the median retailer connected to Headset. The median retailer is the retailer in the middle of the distribution. For example, if there were five retailers connected that had the following inventory amounts:

  • Retailer 1: 5 weeks
  • Retailer 2: 6 weeks
  • Retailer 3: 7 weeks
  • Retailer 4: 8 weeks
  • Retailer 5: 200 weeks

The median of this data would be 7 weeks of inventory. We choose this method because these dashboards are meant to give us information about the average retailer in the market, not give us information about the total units in the market. Here we want to learn what a “typical” retailer looks like and that is precisely what the median will tell us.

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