How to implement a stock management system

To implement an effective stock management system, you must immediately establish a method to track every item that enters and leaves your business. Whether you use dedicated salon software or a digital spreadsheet, the goal is to have real-time visibility of your "back-bar" professional products and your retail stock. This prevents you from over-ordering or, worse, running out of essential supplies during a busy shift.

1. Choose your tracking method

Depending on your budget and the scale of your operation, you generally have two paths to follow:

• Integrated Salon Software: Most modern booking systems (like Fresha or Booksy) include built-in stock management. This is the most efficient method because it automatically deducts retail items from your inventory the moment they are sold.
• Digital Spreadsheets: If you are starting small, a tool like Excel or Google Sheets is a cost-effective alternative. While it requires more manual data entry, it is highly customisable and keeps your overheads low.

2. Categorise your inventory

For a hair or beauty business, it is vital to distinguish between how products are used. This helps you understand where your money is going:

Category	Purpose	Tracking Goal
Professional (Back-bar)	Products used during a service (e.g., hair colour, developers, salon-size shampoo).	Monitor usage rates to calculate your "cost per service" and identify waste.
Retail Stock	Products sold to clients for home use (e.g., styling creams, retail-sized bottles).	Monitor sales trends and ensure high-margin items are always available.

3. Conduct a baseline stocktake

You cannot manage what you haven't measured. Perform a full physical count of every item you currently have. For every product, record the following:

1. Product name and brand.
2. Quantity currently on hand.
3. Cost price per unit (excluding VAT).
4. Retail price (if applicable).
5. The "Reorder Point" (also known as a Par Level).

4. Set your 'Par Levels'

A "Par Level" is the minimum amount of a product you must have in stock before you need to reorder. For example, if you use three tubes of a specific tint every week and your supplier takes four days to deliver, you might set your par level at two tubes. When your stock hits that number, the system (or your manual check) tells you it's time to buy more.

5. Best practices for maintenance

• First In, First Out (FIFO): Always place new stock at the back of the shelf so that older products are used first. This is crucial for products with a shelf life or those that can settle over time.
• Monthly Spot Checks: Once a month, compare your digital records to the physical products on your shelves. This helps you identify "shrinkage"—stock that has gone missing due to unrecorded waste, leaks, or theft.
• Record Every Drop: Encourage a culture where every tube of colour or bottle of developer is logged when opened. If it isn't tracked, you won't know your true profit margins.

Pro Tip: Don't let your cash sit on the shelf. Avoid the temptation to over-buy during supplier sales unless it is a product you are certain to use or sell within the next 30 days. Excess stock is simply "dead money" that could be better used elsewhere in your business.