This is Part 1 of a two-part profile that will run on consecutive Thursdays.

A Marriage Made in (Business) Heaven (Pt. 1)

When the Ho-Chunk Nation of Wisconsin needed to exert more control over the tobacco inventory in its Whitetail Crossing stores, it tightened its management procedures with the help of SSCS technology.

In the ever-changing world of business, technology and disciplined management are tethered to each other. Each contributes to the effectiveness of the other. If both are of sufficient quality, the resulting marriage promotes store growth, profitability, and continuous process improvement.

Such a marriage is currently on display within the Ho-Chunk Nation of Wisconsin. The People of the Big Voice own and operate five convenience stores across the state serving their own community and those surrounding it. The C-stores, branded Whitetail Crossing and pumping Phillips 66 gasoline, use SSCS technology solutions, in particular the company’s complete inventory solution consisting of the Computerized Daily Book (CDB) back office system and Hand-Held Data Processing (HDP) scanning solution.

Whitetail Crossing stores place the highest value on quality customer service, and make a concerted effort, through a variety of initiatives, to provide it consistently to consumers. The enterprise is also distinguished by the large quantities of tobacco products it sells on a daily basis, especially cigarettes. These items make up anywhere from 15–20 percent of the stores’ total inventory, translating in sales that approach $65 million annually.

“We price tobacco products very competitively and, as a result, they do very well for us,” says Bobbi Johnson, accounting manager for the Ho-Chunk Nation department of business. “In many cases our customers don’t just buy one or two cartons; they leave with their shopping bags full.”

Gaining control over cigarette inventory is critical in a C-store, especially when that store tracks inventory by shifts within a day, as Whitetail Crossing does. Product turns over so rapidly that it is easy to get behind in counts. It becomes difficult for a store to assess its inventory’s value at a given time and identify discrepancies. In turn, this leads to arduous and costly end-of-month inventory adjustments, while creating an operational crease into which shrink can creep. Given the low margin and high cost of tobacco products, losses can add up quickly.

Whitetail Crossing had been doing a good job of tracking inventory as an enterprise, having adopted the item level method that has become the accepted baseline for successful inventory management in today’s industry. However the Ho-Chunk Nation knew it could do better.

“We would record only sales transactions on the daily reporting produced by the SSCS back office system, so we had no daily record of inventory cost of goods sold in relation to sales,” Bobbi explains. “We were on a periodic inventory system and wanted to move to a perpetual inventory system that would allow us to go out and verify, at any moment, the number of items on the shelf. The Nation’s financial director and director of the business department decided to overhaul our approach. Everyone wanted to do better so getting buy in from individual store management was easy.”

Thus began a five-month project to analyze and explore ways to ensure that inventory cost of sales values were brought into alignment with total sales numbers, enabling all five stores to access a current and detailed view of inventory movement consistently. The process included cleaning out and restructuring Whitetail Crossing’s entire inventory, as well as standardizing departments and the enterprise’s PLU listing. The undertaking took place on a store by store basis, with up to a month’s break between each site.

Continue to Part 2.