why is stock-out increasing on supermarket shelves?

published on Friday, September 23, 2022 at 08:40

The lack of stock of everyday products such as mustard or sunflower oil has increased in recent months on the shelves of department stores. Explanations of this phenomenon have caused misunderstanding among consumers and do not do business with supermarkets.

• The end of abundance in the French supermarket?
We remember the shortage of sunflower oil after the start of the war in Ukraine, a major producer of this crop.

From now on, it’s the mustard that’s gone, but also the biscuits. In everyday life The Parisiana representative of System U has just been given which has “never experienced supply disruptions of such a high level”. There was also a shortage of toilet paper at the start of the Covid-19 epidemic in 2020.

Since the beginning of the conflict in Ukraine, from the beginning of March to the middle of August, it is mustard, salad dressing, non-alcoholic drinks, crisps, oil or even chicken that is affected., according to a barometer constructed by panelist NielsenIQ. The fact remains that 96.4% of references remain on the shelves in August, according to this same source. But the rate of ruptures, which lasts an average of 4 days, is abnormally high in a country that previously lost nothing.

• How are these stock-outs on the shelves explained?
Until the epidemic of Covid-19, the supply of stores was not difficult. Before placing an order, traders base themselves on the sales of the same period of previous years, taking into account specific events such as celebrating the end of the year or the arrival of good weather. but since 2020, between confinements, teleworking and the impact of the war in Ukraine, the predictions are less accurate.
All players agree that above all the so-called “precautionary” purchases that clear the shelves. These are the customers, who hear that the mustard crops are poor, or see that the shelves are already very empty, thus are tempted to buy more of these products than usual, in order to keep them at home.

“At least in June, we will have no more mustard because we have reached our number for the year”, recently explained in Information on France Michel-Edouard Leclerc, president of the strategic committee of E.Leclerc stores. The French bought in six months what the leading retailer thought it would sell for a year. “If I quote a brand” that may be sold out soon, “everyone will rush” to buy it, also said Michel-Edouard Leclerc.
This excitement escapes the forecasting models of businesses, which want to place an order at the same time, which clogs the supply chain. In addition, suppliers may be tempted to charge more because available stocks are hotly contested.

• Are professionals interested in it?
When sunflower oil returned to the shelves, it was always at a higher price, suggesting that supermarkets were cashing in on the crisis. Professionals responded that these supplies cost them, as well as packaging and transportation. But since demand is high, some may be tempted by higher prices.
In any case, merchants do not want to leave the shelves empty, which they see as a loss of profit, estimated by NielsenIQ at 2.7 billion euros since the beginning of the year. A number that is qualified, however, because it does not take into account the “oversales” that are made when the product is available on the shelves.

• Are some ruptures orchestrated?

However, some successes are chosen by professionals, either agro-industrialists or distributors. Fans of Mikado, Petit Ecolier, Pépito or Pim’s have recently noticed that some of their products have disappeared from the shelves. This is the result of the decision of the group that owns these brands, Mondelez, to “deep clean” a production site, after the salmonella alert in a Belgian factory of one of its suppliers. chocolate. The brand ensures that no product offered for sale contains contaminated chocolate.
Another scenario: the water of the Danone group, including Evian, Badoit, Volvic. In many Intermarché stores, it is no longer sold. There is no stoppage of production at this time but a disagreement between the manufacturer and the trader on the purchase price.

Finally with rising energy prices and the coming winter, some companies, especially in the food industry, may change their production downwards. A decision that will contribute again to emptying the shelves.

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