On Shelf Availability

7/24/2019 On Shelf Availability

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PROJECT OSAOn Shelf Availability

ECR, Thailand


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On-Shelf Availability (OSA) is the ultimate measure of supply chain service.

The shelf is where the supply chain touches the shopper and this first

moment of truth is the very reason the supply chain exists; to make product

available for people to buy.

The availability of product on shelf is of major importance to both retailers andsuppliers and it receives a great deal of focus.

How importance of OSA


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Existing Availability Research(Modern Trade Benchmark)

Below is the most widely used, publicly available research concerning OSA(Gruen, Corsten & Bharadwhaj, 2002, 20 countries & 70,000 consumers, multiple product categories).

Using traditional calculations, for each Out of Shelf (OOS) this equates to approx:

35% manufacturer losses, 3:1 OSA ratio (3% OSA improvement = 1% turnover gain)

40% retailer losses, 2:1 OSA ratio (2% OSA improvement = 1% turnover gain)

9%

26%

19%

31%

15%

Worldwide Average Consumer Responses

Do not Purchase

Substitute- other brand

Substitute- same brand

Buy them at another store

Delay purchase

OSA : Global Research


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In spite of heavy investment to improve

supply chain, Out-of-stock

remains a large problems for retailers,

distributors, and manufacturers.

Worldwide average OOS rate ~ 8%

Promotional OOS rate ~ 16%

*Reference: Gruen, May 2007

OSA : Global Research


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The reason why ECR Thailand give high priority to OSA improvement

and set up as a ECR working project is to meet consumer satisfaction

and achieve retailers and manufacturers business goals.

To deliver great product On Shelf Availability, collaboration across

manufacturers, retailers, and stores is crucial. We all need to work

together to minimize losses along the chain. It is very important to

continuously improve OSA, so that the consumers can trust us every

time they can buy the products they want.

According to significant benefit of OSA, the OSA working team have

defined OSA definition, standard loss tree, loss owner, standardsolution, KPI. This is also the opportunity for us to share knowledge

and learn from each other.


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Understand OSA definition and measurement process

Understand current OSA measurement process of each company e.g.

number of SKUs measured, frequency, time, store visit plan, store

coverage, etc.

As measurement process are variety across industry, ECROSA working

team has agreed to align only OSA measurement definition :

OOS (Out of shelf) = zero piece on shelf

OSA (On Shelf Availability) = 100% - OOS

Step 1

Understand

Step 2 Step 3 Step 4Develop Pilot Share


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Developing Loss tree and Solution

ECROSA working team has shared their practical experiences and

knowledge to define standard OOS loss tree (4 levels) ensuring real

rootcause is identified

Then come up with solutions, loss owners, KPI and period in order to turn

into action for further improvement

ink tostandardloss tree

developed byECR-OSA working

team.xlsx

Step 1

Understand

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ECROSA working team has agreed to do pilot on OSA implementation

Manufacturers Retailers

Unilever vs Tesco , Big C, Makro

Colgate (K.Manutsawat) vs Tesco , Big CNestle (K.Am) vs Big C

P&G (K.Natty) vs Watsons

KAO (K.Tat) vs Big C

L'oreal (K.Anu) vs Tesco , Big C

Tipco (K.Paisan) vs Makro

Step 1

Understand



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To share the summary result from pilot implementation will be posted on

ECR website soon.

Step 1

Understand



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ECR-OSA Working Team


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On Shelf Availability

Documents

Transcript of On Shelf Availability