Small business sales forecasting
Craft equipment innovators, Knit IQ
Knitting and crochet brand, Knit IQ, needed our help to forecast sales, manage a complex critical path and minimise escalating costs. The answer? A bespoke sales forecasting tool that helps the brand see (and plan for) its expected sales demand several months ahead.
When Oliver Lucas spotted a gap in the knitting market he seized the opportunity and founded KnitIQ. Continually innovating and creating new products, KnitIQ now sells through its own website and through Amazon, growing to become a knit-fanatic’s go-to brand.
Oliver came to me with a problem, but I’ll let him explain…
Challenge
“I was constantly chasing my tail when placing orders. I had no detailed understanding of my forecasted cash flow or any comprehension of international pricing.”
Oliver needed to know how to forecast his sales, manage a complex critical path and minimise costs, which can escalate when you hold too much stock.
So, I built him a Forecasting Tool.
Sales forecast
Using the company’s sales history, I built a sales forecast for each product, which then generated the amount of stock he’d need to fulfil customer orders.
This, in turn, worked out when he’d need to order stock, helping him to manage his supply chain and cash flow.
Fast-forward six months and we’ve refined that tool to make it even more bespoke, reflecting the nuances of this particular business. We also catch up every month to actualise Oliver’s sales, stocks and profit, giving him a clear action plan of what to do next.
Results
Sales are growing (after all, it’s a great product!), we’re not dropping out of stock and we’re minimising stock holding costs – and that, in turn, results in more profit.
Oliver is pleased with our progress:
“Sarah and I have worked together to create a systemised approach to ordering which now allows me to plan 6-12 months in advance. This helps in anticipating any potential cash bottlenecks as well as providing suppliers with firm dates to work towards. I’ve also become more aware of the importance of currency when pricing in overseas markets, which has helped protect margins and inform strategic sourcing and operational decisions.”
Chinese New Year is now covered off (no mean feat, resulting in the biggest order Oliver has ever placed) so I guess that means he trusts me!
“Sarah manages to take very complex issues and make them easy.
I no longer have to wrestle with spreadsheets and simply check-in once a month to get a download on our position and the actions that need to be taken.
This has not only given me time back, but it has also helped save money from stock-outs, and margin creep.
Most of all, it has given me peace of mind with this part of my business which perhaps has the greatest value of all.”
—OLIVER LUCAS, FOUNDER
The next step
Next up is to tackle wholesale. I’ll be helping Oliver to grow the business in whatever capacity he needs from me – flexible merchandising support in its truest form!
I’m enjoying the journey and can’t wait to see the business flourish over the coming months and years!
