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Monthly Archives

November 2012

Little Known Leverage Strategies for Lost Sales Reductions - Part 3

Data Profits’ Predictions for 2012 that Retailers need to Know Now

The official holiday shopping and Christmas season kicks-off this weekend, and is considered a bellwether for the retail industry, as this is the time of year when retailers earn up to 40% of their annual profits. Everyone is watching to see:  will post-election results and the continuing shaky global economy drive shoppers back into their recessionary, frugal spending habits or will they be more willing to loosen purse strings?

Another major trend that industry insiders are speculating about is the influence of social media and ecommerce on this year’s holiday shopping season. Will consumers seek and find the best deals from their sofas by using their device of choice, avoiding the mob scenes at the Malls all together? With so many big questions looming, what can retailers do on the eve of the 2012 Holiday Shopping season that will make a strategic impact? Read More

 

drought-strategies-to-successLeverage Your Lost Sales Data to Grow Profits

The key to successful Demand Driven retail is leveraging the right data in the right places. Lost Sales data has a lot of leverage that, when ignored, can be your demise; however, those that successfully measure and leverage Lost Sales data will see sales and profit gains. Our Lost Sales blog today outlines how lost sales data can be used to improve inventory optimization and highlights how all the pieces are interconnected. We also dive into the differences between lost opportunity and lost sales, the differences and impacts between the two, and close with some sobering statistics from Lost Sales data collected from the industry.

Our first blog on Lost Sales highlighted the staggering impact of Lost Sales in most businesses today. We outlined some of the methods used to calculate lost sales, and why these methods do not deliver value. Our second Lost Sales blog reviewed how lost sales can add value to demand forecasting and improve the accuracy and value for the service attained calculation.
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Truth, Lies, and Strategies for Lost Sales - Part 2

Why Lost Sales are Ignored

Our last blog highlighted the staggering impact of Lost Sales in most businesses. We outlined some of the methods used to calculate lost sales, and why these methods do not deliver value. We touched on in-stock and Service Attained as two measures that in the past were acceptable inventory ROI measures but, in the market place today, these methods are dated and focus retail in the wrong direction.

With the advancement of inexpensive hardware, we can calculate a very accurate demand forecast across any block of products in our assortment and measure the business at any individual (or group of) product / locations. We can easily track available inventory for any product/location at a moment’s notice. This makes calculating lost sales a simple calculation: sum demand for the days where available inventory <=0. Today, we will review how lost sales impact demand forecasting, service attained, and inventory optimization.
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