John Preston loves geeky financial concepts like clothing inventory control and used them to help families make wise financial decisions on his blog My Family Finances. You can follow his latest writing by subscribing to his blog feed. He is also a weekly contributor for US News & World Reports’ My Money blog.
It’s been said that a man will pay twice as much for something he needs and a woman will pay half as much for something she doesn’t. It’s not true, though; sometimes the woman does need it, she just doesn’t need it yet.
It doesn’t matter if your closet is stocked, when there’s a good deal, it’s wise to buy because clothing doesn’t last forever. Someday, you are going to use it – the 5th or 6th spare bathing suit. By taking advantage of the low price now, you are saving money over the long term.
A woman’s ability to understand that shopping plus time equals lower costs is a concept lost on my fellow men. It’s a large reason why we males are often the big spenders on gift shopping and other categories, except one area: clothing.
How is it that men are the superior apparel shoppers when women have the option of buying shirts on clearance for $5? The last deal I got was $20 and only because they mislabeled the shirt XXL instead of medium. How can this be if women are renowned deal shoppers?
Women Need Classes on Inventory Management
As I pointed out earlier, the idea of buying today at a lower cost to save over a future budget is a valid way to save money. So what goes wrong with women and clothing?
When a company buys something today to use or sell later, it’s known as buying inventory. There are all kinds of advantages to inventory. You can lock in a large quantity at lower prices, take advantage of buying in bulk and ensure that you have an uninterrupted supply of product. This is really what women do when they go clothes shopping and buy in advance; they are expanding inventory. There is some danger to this strategy, though.
Inventory is an Investment
There is nothing more dangerous to your clothing budget than too much inventory. Think about this: when you hold inventory, you are making an investment. You hope that by holding more clothing now, you’ll save money over the long-run. This means that the size of your inventory determines how much you tie up your money, and for how long.
Let’s say you spend $10,000 on a big shopping trip and now have enough clothing to last 10 years. You may have saved a lot, but it’ll take ten years for you to have received full benefit on your $10,000. Plus, what if you keep shopping regularly, and each year you add two years of inventory? If inventory is always growing, you are simply tying up more of your money and not letting yourself experience the benefit of all the deals you’ve found.
Inventory is an investment, but you’ll never get the value of it if it’s only growing.
Holding Inventory is Risky
You see, holding inventory has its risks. If you hold onto it for too long, it can become obsolete, it can spoil, it can get destroyed and it’s more likely to get misplaced. Let me translate these into personal wardrobe experiences.
Obsolete: It’s a new style every season in the fashion world. So if clothing is obsolete every three months, why do you have a seven-year inventory of clothing? You won’t get value if you are shopping to keep up with the style changes.
Plan on having children? My sense of self-preservation tells me to stop here.
Spoil: Ok, this one isn’t all that common for clothing. However, if you have part of your wardrobe sitting in a box in the basement or attic, it does run the risk of molding from moisture or heat. Wool risks being eaten by moths. Clothing does require a minimal amount of care and that care takes up space. For some, it’s a lot of space and that’s a cost in itself.
Destroyed: It might not be a likely event, but what if there was a flood or fire? A 20 year hoard of clothing isn’t just large. It’s a pain and expensive to replace in the event of catastrophe.
Misplaced: Where’s your favorite shirt and will you ever find it in the sea of all that clothing? The more you have, the harder it is to keep track of things. Disorganization keeps you from getting value in your clothing inventory. It also is harder to monitor siblings and young adult children who are raiding your closet to improve their own fashion inventory.
Managing your clothing inventory is essential to taking advantage of the deals you’ve been shopping.
Know When You Have Too Much Inventory
If you want to make sure you aren’t letting your closet grow out of control, here are some things to do that will help you recognize when you might be hoarding clothing instead of investing.
1. Are you running out of space? It could be that you just didn’t have enough space to begin with. Fine. However, if you have a healthy level of clothing in your closet at one point, but now are starting to invade ‘his’ side of the closet. You are probably hoarding more than investing.
2. What’s the oldest section of your closet? Granted, you may always run across a 15-year old top every now and then, but what’s the overall life span, and does is seem like the span is growing from year to year?
3. Are you always finding lost clothing? I’m happy that you located the pants that have been missing for two years, but regularly finding your clothes is a sign that you are beyond the size of inventory that you can handle.
Of course, it should be noted that many shoppers buy clothes to satisfy a psychological urge and those problems need to be addressed. No sale can justify it and no amount of inventory control will fix it. However, shopping for sales can lower your total clothing costs, but you need to understand how to use this type of shopping if you actually want to cash in on the savings.
Shopping can be good; it is purchasing that can be unhealthy or imprudent.
Do you think that you are shopping just to expand your "inventory?" Do you consider the items you buy "investments?"