The analysis of FMCG product availability in retail stores

Abstract

© 2014, Kauno Technologijos Universitetas. All rights reserved. Seeking to reduce consumer purchasing effort, retailers strive to provide adequate product availability levels in retail stores. Otherwise, consumers may find themselves in stock-out situation, which may be a waste of their time, money and energy. As the mentioned situation intends to make a negative impact on the business performance of retailers and their suppliers, the issue of on-shelf product availability deserves particular attention. This article analyses this issue from the aspect of certain characteristics of product sales. Product availability, expressed by means of out-of-stock rate, is compared within various categories of sales variation and speed of turnover variables. In addition to these characteristics, product availability is also analysed from the aspect of various retail formats. The results have indicated that products with the highest sales variation, as well as slow turning products, are the most problematic in terms of on-shelf availability; in other words, they are characterised by the highest out-of-stock (OOS) rates. On the other hand, unlike large-scale retail formats, average store availability is the lowest in superettes, which indicates that the average OOS rate declines with the size of retail formats. In addition to serving as a basis for further research related to product availability in retailing, the given results may be used by retail managers when optimising customer service levels.