Here are the details of what constitutes a stock out is and its effects.
Today’s post is from our SafeSourcing Archives.
A stock out, or out-of-stock (OOS) is defined as “a term used in product manufacturing or distribution to describe an inventory shortfall arising from unexpected demand, ineffective inventory management, production delays or replenishment disruptions.” This leaves obvious undesired effects for both the business and the customer.
If merchandise is not available for a customer there may be many possibilities. Your customer may decide to wait to purchase the product. If the product is essential to the customer, then they may be prepared to wait. Even with the willingness to wait, there might be a considerable downturn to the customer’s satisfaction level.
The customer decides to purchase from another vendor or retailer. If the customer is able to obtain the product elsewhere or does not need the item immediately, this is the normal outcome. It is still possible that the customer will do business with you in the future, but this may be detrimental to their customer satisfaction level.
The customer is no longer a customer. This is the potential worst case scenario of a stock out. If a customer is unhappy being unable to immediately purchase the desired product then they may also be willing to permanently purchase or procure this product from another vendor or retailer.
We enjoy bringing this blog to you every week and hope you find value in it. We want to help keep your shelves stocked, with the products your customers need. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.
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