Make Sure Out of Stock Doesn’t Ruin Your Next Big Local Event
$600 Billion. That’s the annual loss to retail stemming from Out of Stock (OOS) issues. Worse, Out of Stock issues can result from labor and quality issues in addition to product availability on shelves. If you want to keep your sales and customers, keep watch of your stock, your labor schedules, and store appearance.
Out–of-Stock is the bane of retailers everywhere. In an ideal world, customers walk into your store, find the product they want, and walk out after buying. According to a recent IHL Report, OOS is anytime a customer enters your store willing to make a purchase and leaves without buying, for whatever reason — not just because product was not available on the shelf.
OOS can occur for many reasons, including: inability for the customer to find the right item, poor service from uninformed associates, or inadequate staffing. These problems can be especially troublesome during times of peak sales of certain items during specific times of the year such as a big football game or a concert.
During these big events, like a football game, grocers often see spikes in certain departments, like deli. A recent Progressive Grocer (starts on page 80) study shows that 26% of the time deli departments don’t have the product or desired experience that shoppers want. The same survey reported that 70% of shoppers will go to a different store if they experience OOS issues more than three times. That’s the football equivalent of the offense having to punt to the opposing team after three plays without getting a first down. In other words, not good.
As pointed out by Progressive Grocer, the Out of Stock issue goes deeper than not having the right selection of product at the deli. Out of stocks can also be due to poor service provided by an associate and even the appearance of the deli itself. According to the Progressive Grocer Report, the three largest reasons for OOS are:
- Product Issues (68.3%): overcooked or dry product, overall appearance or taste of products
- General Deli Issues (65.9%): long wait times, availability of product, cleanliness, and appearance
- Staffing issues (26.7%): staff knowledge, friendliness, if staff is helpful or rude
OOS issues can even occur from the appearance of the overall deli department. What happens if your deli counter is unclean or dishes and utensils are everywhere on the sink? Customers walk away. These problems can occur by accident, but can still have a negative impact on your sales.
Between all the causes of OOS retailers are losing over $600,000,000,000 a year. If you want to change this, and not be a victim of OOS, look to technology. Here’s how a platform of real-time store execution and workforce management solves retail’s vexing stock-out problems:
- Optimized labor scheduling with shifts generated using advanced forecasting that takes into account customer demand, including spikes due to big events such as local basketball championships
- Task management to drive higher compliance across your stores, including deli appearance, team member training, and consistent best practices
- Real-time store execution to respond to last-minute problems such as stock-outs, employee sick callouts, and weather. Integration with cognitive tools like IBM Watson enables stores to leverage news reports and other data sources to anticipate and respond to surprises — such as when a visiting football team predicted in pre-season to be a doormat rolls into town undefeated with thousands of extra travelling fans.
With the platform of Reflexis StorePulse real-time store execution and workforce management, retailers can make the most of sales opportunities to stop stock-outs and improve revenue and profitability.