In years to come, the extreme product shortages of the pandemic may seem like just another blip in the history of marketplace behavior, but they leave behind a permanent realization that the possibility of near-term events that can rapidly cause consumer demand to explode or supply to be interrupted is very real. Furthermore, these events seem to be happening more than ever before, and they can also defy market logic. Case in point – the recent unbowed demand for lumber despite prices that are more than four times the norm.
Fashion retailers have invested heavily to drive tighter assortments, dynamic allocations, and omnichannel inventory efficiency. But if a customer can't find her size, all that work is moot. In fact, the tighter the inventory, the more it exacerbates the size stock-out problem.
In the face of competition from private label, new brands and online fulfilment, which is stressing margins, consumer brands will need new ways to work with retail partners to optimise allocation and replenishment, says Alex Barnes from antuit.ai.
Shortages continue to be an ongoing story of this pandemic. Even Post's Grape-Nuts made news for their out-of-stock issues. What started as toilet paper, water, disinfectant wipes, coin shortage, aluminum shortage, found its way to Grape-Nuts, and computer chips. But these are the headlines. Underneath there are several companies dealing with supply shortages.
Where does it hurt? Everywhere.
We all knew that there were challenges because of supply chain disruptions, but one thing sums it up.1