Creating a strong chain connecting suppliers to customers is a major objective with many smaller goals within it. For instance, avoiding out-of-stock situations wherever and whenever possible may be one of the keys to selling success, as it represents a way to keep potential business from slipping away. In an era when people can make large-scale purchases from the phones in their pockets, losing customer attention due to an out-of-stock item is a more damaging prospect than ever before.
Today's innovations, from omnichannel operations to the increasing speed of delivery and logistics, have the simultaneous effect of making quick inventory adjustments possible and complicating the overall retail picture. Some manufacturers will find ways to master these processes, while others may struggle to help their retail partners put the right items in front of shoppers.
Cleaning up the supply chain
Supply and Demand Chain Executive contributor Paris Gogos explained that tracking down and preventing out-of-stock situations comes down to many different factors, and identifying what has gone wrong is the key to discovering an answer. Gogos offered several of these worrisome possibilities - if a manufacturer is able to pinpoint a single store in a chain that is suffering from "phantom" stock or incorrectly predicting the demand for an item, it can take a more active hand in getting retail partners on the right track.
More advanced supply chain technology can help companies resolve their connections with retailers and counter any stock outages. Gogos suggested cloud-based technology with clean and accurate data. Establishing close links to data flowing in from point-of-sale interactions at stores may be a more effective route to information gathering than simply relying on the databases operated by retailers; Gogos warned that stores' systems can be high on incorrectly entered data or phantom stock.
Food Dive contributor Victoria Vessella recently explained that there is value in not just accurately determining when items are out of stock but also getting ahead being proactive. Focusing on food manufacturers that deal with businesses through sales representatives, Vessella stated that this active and effective approach to anticipating out-of-stock situations is based on auditing and frequent data gathering.
Representatives from food brands can become invested in ensuring that they account for all sales variables, from whether stores are complying with the planograms for product displays to the habits they have displayed in ordering new products, as well as the effects those purchases have had on inventory. Seasons and consumer preferences over time can also have an impact on which items linger on store shelves and which sell out quickly. If retailers track such fluctuations and keep their information up to date, they may be able to help their retail partners - and their sales - thrive.
Solid links needed
The retail supply chain from manufacturer to shopper can break down if even one step of the process has gone awry. Keeping products on store shelves is one of these potential failure points. Even supply agreements that look great on paper can disappoint all parties involved if problems appear in data, retailer policies or enforcement of those agreements.