Should I Stock the Product or Floor It and Special Order?   

There is a lot of debate on whether you should only sell the product the you floor, whether you should stock the furniture that you have on the floor or if you should just special order for customers when they like a floor sample. When you sell from vendors that you can pick up from the same day, then of course you shouldn’t stock the product because you’ll lose out on GMROI. GMROI is gross margin return on investment. Basically, it is the calculation of how much gross margin return you get on the investment when you buy furniture. You calculate that by cost of inventory. So if you don’t stock the product in your warehouse, then you will have less cost of inventory. The issue arises when you have vendors that take weeks or months to deliver. Then you may lose out on the customers that want fast delivery or even same day delivery.  

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