Seven out of 10 consumers believe stock-outs are worse today than they were during peak pandemic-induced panic buying.
Retail Insight’s survey of 1,000 U.S. shoppers published last month suggests product availability is bad in stores (54 percent) and potentially worse online (61 percent).
“For the most part, shoppers are understanding of the well-publicized and multifaceted pressures facing retailers in today’s challenging trading environment, but that does not stop poor availability, out-of-stocks and shelf-gaps from becoming more than just a bone of contention in their buying journeys,” Retail Insight CEO Paul Boyle said.
Out-of-stocks drive consumer dissatisfaction “whether in-store or on the digital shelf,” putting loyalty at risk as retailers lose roughly 8 percent of their revenue due to subpar inventory availability, Boyle said. “When combined with intensified competition and spiraling supplier and manufacturing costs” this is “revenue retailers simply cannot afford to leave on the table,” he added.
Boyle also pointed to “a consumer perception gap in what was actually available during the early days of the pandemic and now,” he told Sourcing Journal, citing retailer data. “Product availability is higher than at the lowest points during the pandemic, but is still significantly below pre-pandemic levels.”
Media headlines trumpeting ongoing supply chain problems aren’t helping the situation. “Retailers are improving in how they handle issues driving out of stocks, but with ongoing media coverage, consumer perception does not reflect some of these improvements,” he said.
The “perception gap” hits some categories harder others, Boyle pointed out. Beauty and cosmetics, essential items for the home and hardline appliances and electronics are making strides with availability, but shoppers still believe selection is suffering. “Only in home goods do we actually notice consumer perception improving ahead of real availability improvements,” he said.
Today, 48 percent of survey takers believe that the pandemic is still the primary cause of stock issues, and 36 percent blame warehouse worker shortages. Others believe retailers haven’t adopted inventory planning tools quickly enough, with 44 percent saying retailers lack the tech infrastructure to manage changes in demand.
Consumers have ideas on how to fix the problem. While retailers from Target and Macy’s to Saks and Under Armour have boosted wages and benefits to recruit and retain store and warehouse staff, 66 percent of respondents believe better pay and working conditions would improve inventory availability. A full 34 percent said retailers and their suppliers must collaborate more effectively to streamline the flow of goods, while 28 percent urged improvements in logistics capabilities. The pandemic also highlighted a need for better forecasting capabilities for 26 percent.