Nick Bartlett

☹️ 𝗔 𝗥𝗲𝗮𝗹 𝗙𝗼𝗿𝗲𝗰𝗮𝘀𝘁𝗶𝗻𝗴 𝗟𝗲𝘀𝘀𝗼𝗻 ☹️ I've asked them why... And they can't help... 𝗔 𝗧𝗿𝘂𝗲 𝗦𝘁𝗼𝗿𝘆. One of the main Supermarket chains here in Australia opened a new store near my home. We've been going there for the last 6 months. Whilst we're used to the brands and layout of our regular store (the other main Supermarket Chain) one thing has me coming back to this new store. Every time! They have an 𝗶𝗻-𝘀𝘁𝗼𝗿𝗲 𝗯𝗮𝗸𝗲𝗿𝘆. OK, Nothing new in that. But there is one bread recipe that keeps me coming back to this store, even though it's further from home. The soy bean whole meal loaf. It's amazing. Best bread I've ever tasted. And this is a person that loves nice bread. 𝗕𝘂𝘁 𝘁𝗵𝗲𝗿𝗲'𝘀 𝗮 𝗽𝗿𝗼𝗯𝗹𝗲𝗺. In the particular rack where this bread is displayed, they have 5-6 other interesting bread types. Garlic, Potato, Olive, Seeded. All yummy, but it's the Soy Bean I crave. And here's the problem. They only seem to make about 10 loaves each morning. And unless I get there by 10 am, they're gone! Plenty of all the other types. In fact I could go there at 6 pm and still get many of the other recipes in the range. But the Soy Bean. No way. 𝘐𝘧 𝘧𝘭𝘺𝘴 𝘰𝘧𝘧 𝘵𝘩𝘦 𝘴𝘩𝘦𝘭𝘷𝘦𝘴! I even spoke to the baker early one morning, asking if he might make more of the Soy Bean. "𝘐 𝘵𝘳𝘺 𝘵𝘰 𝘥𝘰 𝘢 𝘤𝘰𝘶𝘱𝘭𝘦 𝘦𝘹𝘵𝘳𝘢 𝘦𝘢𝘤𝘩 𝘥𝘢𝘺" he told me. No doubt the forecasting is done at head office and he gets what he gets, in terms of resupply of bread mixtures. 𝗦𝗼 𝘄𝗵𝗮𝘁'𝘀 𝘁𝗵𝗲 𝗹𝗲𝘀𝘀𝗼𝗻 𝗶𝗻 𝘁𝗵𝗶𝘀? And OK, it seems like a trivial thing I know. But imagine this playing out on a much larger scale, with whatever products you sell to the market. How many customers will merely buy the Olive bread, or another type, as a substitute, when they really wanted the Soy Bean? Many I'm sure. But ... how many will not buy bread at all, or worse still, will abandon their shopping trip, to go to your competitor. Sadly the competitor doesn't have the same type of bread, but they have a 'second best'. And given I only started using this 'new' store, because I loved the bread, I'll probably just fall back into shopping at the competitor. (it's closer to home) 𝗧𝗵𝗲 𝗟𝗲𝘀𝘀𝗼𝗻?  (from my trivial shopping preferences) You must track 'true' demand when forecasting. That way you also track 'lost sales'. Otherwise you're perpetuating the customer service problem, by continually providing a 'substitute' for what the customer really wanted. Industrial businesses, hardware businesses, furniture, you name it. In the hundreds of businesses we've worked with over the years, we see it. Forecasting based on 'negotiated' or substitute sales rather than true demand. (back orders can perpetuate this too) Maybe have a think about your own product range? Do you track true demand? Oh. And yesterday they told me they will no longer make the Soy Bean bread... ☹️ #forecasting #supplychain

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6 Comments

Great analysis from my colleague Shaun O'Reilly outlining the impact of interest rate rises and inflation on consumer spending and retail sales. Whilst this economic environment is tough for retail, some retailers will see this as an opportunity to pull away from their competitors through: 1. Control the controllables - make sure every AUD you spend, brings in more than $1 in value, as quickly as possible 2. Know and adapt to your customer quickly 3. Work with, not against your suppliers - you need them as much as they need you 4. Disciplined cash management; and 5. Take tough decisions quickly Joan Uy Amy Shi Adrián García Will Kelly Renzo Renting Alvarez & Marsal

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