How to Prevent Stockouts using Retail Data Analytics
Retailers, Data Management
It's hardly unexpected that stock shortages pose a crucial issue in the retail sector. As per advisory firm IHL, these shortages result in almost $1 trillion in lost sales yearly. Assessments indicate that suppliers typically forfeit around 10% of their sales annually due to stockouts. Furthermore, inventory depletion doesn't solely cause revenue loss but can also harm retail relationships in lasting ways.
Complicated retail data results in challenges with managing inventory
We collaborated with a prominent shoe brand experiencing inventory depletion both online and in stores. Consequently, they were losing sales without awareness of the problem or its underlying causes. What factors led to these challenges for the shoe supplier?
Similar to numerous other companies, acquiring sales and inventory data from retailers posed a challenge for them. Their team had to navigate multiple sources, cobbling together the data. Consequently, this led to disparate versions of truth and diverse reporting methods within the organization. Consequently, obtaining a clear overview of inventory depletion or when items were at risk of going out of stock became nearly unattainable
Utilizing insights derived from data to comprehend the reasons behind inventory shortages
Due to the intricate process of gathering, refining, and interpreting data, it's understandable that many companies face challenges in preventing stock shortages. However, leveraging a retail data analytics solution like EDI by Design’s Analytics can help brands decrease stockouts by 10% or higher.
Utilizing the Analytics solution grants companies access to comprehensive insights into inventory possibilities across all their retail partners. Consequently, they swiftly pinpoint areas where stock is depleted or insufficient, enabling their teams to focus more on exploring new sales prospects and less on assembling fragmented data.
Explore strategies to avoid inventory shortages and increase sales by ensuring the correct products are available in the right places when consumers are prepared to make purchases. Access our Retail Data Analytics Playbook to delve deeper into these insights.