By: Mark Baum, FMI Chief Collaboration Officer, and Senior Vice President, Industry Relations, FMI
Despite the uncertain economic environment, we find ourselves in currently, consumers remain largely resilient and flexible in their purchasing decision-making. While concern over inflation and out-of-stocks continue to be top of mind for shoppers, the shifts in shopping habits over the past three years demonstrate that food retailers need to be nimble to continue meeting customer needs and offering value across departments and product categories.
A recent survey FMI conducted in February shows that inflation and out-of-stocks remain significant areas of concern among shoppers, with more than three-quarters of consumers (76%) now concerned with rising prices and 44% with out-of-stocks. Next month, we’ll be releasing the first installment of our U.S. Grocery Shopper Trends 2023 series, “Shopping Trends,” which will dive deeper into these concerns and the ways consumers say they are navigating these and other challenges.
What we know is that if the price isn’t right or a product isn’t available, the consumer has several options. They can:
- Look for deals and adjust what they ultimately buy.
- Trade up, down or across a category to find a substitution.
- Cherry pick multiple stores to find what they want – despite the inconvenience.
These options might work for shoppers, but for retailers, shifts like this can lead to volatility or even the risk of a lost customer.
In addition to inflation and supply chain issues, we’re also managing labor shortages and workforce challenges. According to the FMI Imperative Issues 2022 report, industry leaders and FMI members identify supply chain disruption as the second most-highly ranked issue of the day – just behind labor concerns. Specifically, executives tell us that it is of the highest urgency to maintain product availability. We want our customers to find our shelves – both in-store and online – fully stocked. But, how can this be done with a limited workforce?
Innovations to help eliminate out-of-stocks are out there. Real-time information on product availability can be retrieved through in-store drones, robots and camera-mounted artificial intelligence. These are all worthy solutions, but if it is not on the shelf missing product is an out of stock (OOS), even if it is in the back room.
Today’s economic landscape calls for a solution without the need for additional capital or labor investment that uses the data you have to glean actionable insights. Collaborating with a solution provider can help you translate numbers into next steps to prevent out-of-stocks before your customers find an empty shelf or abandon their cart mid-aisle. For example, the ReposiTrak Out-of-Stock Management solution uses existing sales data to identify gaps, and their team of industry experts (real people) work hand-in-hand with retailers and vendors to provide action plans, follow-ups and measurement.
As retailers, it’s our role to provide what the consumer needs, when and where they want to shop. While some issues like inflation and supply chain disruption are outside of our realm of control, there are plenty of ways within our walls where we can adjust and maintain focus.