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CASE STUDY
A leading CPG company successfully mitigates out-of-stocks, saving millions in annualized lost sales
Snapshot
SOLUTION AREA
Supply Chain
SOLUTION
On-shelf Availability
INDUSTRIES
CPG
CLIENT
Manufacturer
The Objective
A leading consumer packaged goods company suffered frequent out-of-stocks across its diaper portfolio, leading to on-shelf availability challenges. After investigating, the manufacturer uncovered a discrepancy in its diaper sales forecasts with a key retailer. The manufacturer sought to strengthen its partnership with the retailer by using data to demonstrate how out-of-stocks were caused by the disparity, and to show the dollar impact of lost sales resulting from the out-of-stocks.
The Solution
Using sales and inventory data from Circana's supply chain solution, the CPG company quantified the effects of short ordering for the retailer. It also identified which stores required surge allocation to mitigate lost revenue from out-of-stocks.
The Results
Based on its findings, weekly meetings with the retailer's supply chain team were put in place, ensuring alignment with the manufacturer on order projections. After adjustments, the next quarter realized a reduction in out-of-stocks, generating a savings of over a million dollars in annualized lost sales!
63%
Reduction in out-of-stocks
$1.6M
Saved in annualized lost sales from out-of-stocks
