Merchandise Visibility is essential for dynamic consumer demand
Retailers are cautiously increasing inventory in response to slowly increasing consumer spending. However, retailers recognize that the recovery is fragile, and they must avoid the risks of costly overstocks and markdowns.
At the same time, studies show that global out-of-stocks are more than 8 percent, costing retailers 4 percent of sales. While retailers recognize the need to limit overstocks, the potential for out-of-stocks, dissatisfied customers, and lost sales is a significant risk if they fail to hold enough inventory.
In response, retailers are attempting to be as agile as possible, to react to ever-changing consumer demand by maintaining adequate shelf availability without excess inventory. According to Scott Krugman, Vice President of the National Retail Federation, “It looks like the economy is coming back, but the recovery is fragile. Retailers are especially interested in how they can nimbly respond to the way consumers and the economy will behave this year.”
Headlines from leading publications such as The Wall Street Journal, The Chicago Tribune, and Money Magazine further illustrate the challenge:
- "Retailers Stock Up on Caution"
- "Retailers continue defensive inventory strategy. But with low stocks, stores may be in a bind if sales increase.
- "Shoppers picky as they head back to stores
What can retailers do to manage inventory dynamically, ensuring adequate inventory to meet consumer demand without either excess or out-of-stocks? Click here for more information on Checkpoint's Merchandise Visibility solution.