Thursday, April 07, 2016

Category Management Series: Out Of Stock Still One Of The Worst Thing That Could Happen To Retailers

We have already discussed about how important out of stocks are for retailers. Indeed, most of the time, a product missing implies a lost sales. In France, it is 1,2 Billion € the cost of out of stock in 2015.
Inventory is a very important part of the strategy of one retailer. It cost obviously a lot of money, especially when it does not rotate, but also it is what allows retailers to attract customers. I always loved the philosophy of Anders Dahlvig, former CEO of IKEA about stock. Instead of considering it as a liability, because it costs money, it considers it as an asset, as the stock is what empowers sales.

Here is an up to date chart about the impact both on results and shopper experience of out of stock.