CV-19 Insights

CPG manufacturers and retailers are losing billions of dollars in sales each year due to out-of-stocks (OOS). But, this is only a piece of the larger on-shelf availability (OSA) problem challenging the global retail industry.

As we’ve mentioned in previous blog posts, industry benchmarks continue to cite OOS rates of 8-10% for non-promoted products and 10-15% for promoted items. These OOS percentages will only increase with the continued growth of online ordering and the growing “click & collect” trend.

Furthermore, when faced with an out-of-stock situation, a shopper has a few alternative options. The first time an item they want is not available, various studies have shown that they’re most likely to simply select another similar product. The second time, they may select an alternative, make no purchase, or buy elsewhere. The third occurrence will most likely result in the consumer turning to another store entirely or buying online through Amazon. (The explosive growth of Amazon Prime is a vivid example of this.) Not only is there a loss of revenue at stake, but a loss of future revenue and brand loyalty as a whole. And with OOS percentages likely to increase because of e-commerce and labor-related challenges, the issue will only escalate.

Here’s the billion-dollar question: Are you really ready to effectively deal with these OSA challenges in order to maximize sales and delight your consumers? To help you quickly assess your OSA readiness and a lot more, we’ve created an OSA Checklist which poses a number of very relevant and timely questions to get you started on improving your OOS rates. For example:

• Are you currently receiving smart alerts to determine the root causes of OOS problems, so you can then prevent them from reoccurring?
• Are you using OSA scorecards to measure the total value of recaptured sales across categories and geographies?
• Are you aligning your growing omnichannel sales with in-store OSA programs to ensure your shoppers don’t encounter empty shelves?

Check out our full OSA Checklist to see if you are an OSA superstar – or ready for an OSA intervention!