missing_product_from_shelf_clear_example-1080x675.jpg.webp

SUMATUS Out Of Stock monitoring solution.

Did you know that while using an artificial intelligence (AI) tool to monitor stock balances, retailers can significantly reduce the level of lost sales due to store OOS, distribution center OOS, shelf OOS (Out-of-Stock). This could prevent a loss of 780 Euros per week for medium size shop and could reduce OOS by at least 15-25%.

Problem

  •     The average worldwide out-of-stock rate is about 8.3% and this is the reason for the loss of around 4% of sales.

  •     47% OOS events are store OOS, 25% – shelf OOS, 28% events are caused by other external factors, mainly suppliers.

  •     The level of coincidence of actual and accounting stock balances is 35–45% of cases. This is the main reason for store OOS - incorrect orders are placed, which create a ripple effect, distorting demand and leading to inaccurate forecasts of demand.

  •     OOS reduces the impact of promo on sales and creates customer dissatisfaction.

  •     OOS also increases staff costs as employees spend time taking care of customers who are interested in product availability and searching products.

Root causes of OOS

  • Incorrect stock balances due to which understated orders are formed:

  • The accounting records include items that in fact are not in the store - goods not written off on time or accumulated due to re-sorting.

  • The accounting records include items that are physically present in the store but not suitable for sale. They are not written off on time, damaged or expired goods.

  • The item is present in the store, but it is not on the shelf or is not placed correctly:

  • They are items lost somewhere in the store - in the store backroom or placed in the wrong place.

  • They are products that are on the shelves, but shoppers cannot find them

          • Items which were hidden by other products when loading.

          • Items which are not in large quantities hidden deep in the back of the shelves – shoppers do not see them.

SOLUTION: AI application – SUMATUS OOS monitoring

  • The algorithm analyses the stock balances of each item in each store (central warehouse) every day and identifies unusual stock balance movements

  • Employees of each store automatically receive a specific list of problematic items every day to check, as their movement has become unusual.

Why choose our solution?

  • The solution helps reduce OOS level about 15-25%.

  • The solution was developed by professionals in the retail trade sector with 20 years of experience together with specialists in advanced mathematics.

  • The solution saves time for management and stores employees to track problematic stock balances.

  • The solution helps make correct orders both manually and automatically. This is a perfect add-on application to retailer’s existing ordering tools; the algorithm makes the work of the automatic ordering tool more accurate.

  • Integration of the solution with retailer’s systems is quick and easy.

Download 1PAGE info sheet about SUMATUS OOS solution