Impact of out-of-stocks at P&G

P&G's director of Global Supply Chain Operations detailed the effects of out-of-stocks on P&G's top brands at a supply chain conference in North Carolina:

He said based on P&G's top 100 stock keeping units data, when consumers face an out-of-stock product situation, 48 percent switch stores, 10 percent do not buy the product, 31 percent purchase at another retailer, 14 percent delay the product purchase, 19 percent substitute another brand, 18 percent substitute another size.

Wal-Mart recently stated that tests show that use of RFID technology can cut OOS by 16%. I think that integrating trade promotion planning data with RFIDs could make the impact even greater, since many (probably most) OOS situations are caused by promotions.