Why being in demand and out of stock is not a position you want to be in

“The soaring popularity of Veganuary has led to a raft of shortages of the UK’s biggest plant-based brands”

The Grocer, Vegan brands struggling to keep up with soaring demand.

The majority of the larger plant-based brands including Quorn, Linda McCartney, Fry’s and Vivera all declared out of stocks across their ranges in January. At one point, Quorn reported a whopping 58 SKUs as being out of stock.

‘It is a good problem to have’ – I have heard it far too many times and am ashamed to admit that I have said it myself more times than I care to remember. Increased demand is indeed a positive sign, but it would be even better if it was not a problem at all, right? The cost of out of stocks is huge from whichever angle you look at it. As the supplier, you lose sales and when they are gone, they are gone (pardon the retail pun) as the consumer is not waiting to buy in bulk when you have eventually stocked up again. The retailer has empty shelves, literally their most expensive real estate; they are not happy, and it goes against your supplier scorecard. Then there is the consumer, the mighty consumer from whom you crave loyalty and attention. They have just been left disappointed and probably bought a competitor’s product instead.

So, as reassuring as it may be that even the big brands get it wrong from time to time, it is never ok to have out of stocks. It is even more important to get supply right for a smaller brands attempting to make a name for themselves on the big stage.

When we launched our Outsourced Planning solution, it was with the knowledge that ‘planning’ is where everything often starts to unravel. You can have the most attractive brand in the market and nail every sales pitch, but if you cannot sufficiently cater for demand, then really what is the point in the former.

Consumers are forever changing their minds, making it impossible to predict demand. It is even harder when there is no existing data or knowledge as to how your products will perform. That is what we contend with as smaller brands daily.

For me, supply planning in the high-growth, innovative brand space really is an art (not a science) that boils down to good infrastructure to create visibility and the right decision-making forums, great communication with both internal and external stakeholders, and a finger on the pulse at all times to reduce the chance of being caught off guard. 

If any of this resonates with you and you would like to explore working with us, have a read of our Outsourced Supply Chain page or get in touch.

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