Progressive Grocer: Will Out- of-Stocks be a Thing of the Past?

Technology provider Retail Solutions Inc. (RSi) and sales and marketing services company Crossmark have teamed up to launch OSA360, which they say is the first end-to-end offering enabling CPG manufacturers and retailers to solve their out-of-stocks (OOS) issues.

OSA360 combines the two companies’ retail industry experience, global footprint and technology expertise to create a one-of-a-kind, “closed loop” offering. The new product is designed to help CPGs and retailers maximize their on-shelf availability (OSA) and recapture millions in sales that are lost each year to OOS and inefficient in-store execution.

Retail industry benchmarks consistently cite OOS rates of 8 to 10 percent for non-promoted products, and 10 to 15 percent for promoted items. As a result, OOS problems cause an estimated $130 billion in annual lost sales in the U.S. retail industry alone. Retailers and suppliers have long attempted to address the OOS issue through a variety of measures involving people, processes and technology, but these efforts have fallen short because of a lack of end-to-end integration.

OSA360 closes the “technology/execution” loop to give retailers and CPGs significantly faster and more effective action on OOS alerts. The partners say this creates satisfied, loyal shoppers, leading to substantial increases in recaptured sales and higher profits.

“I don’t think anyone has attempted this closed loop before,” Kirk Wheeler, senior VP of global sales and marketing at Mountain View, Calif.-based RSi, told Progressive Grocer during the recent Food Marketing Institute Midwinter Executive Conference.

RSi and Plano, Texas-based Crossmark are currently in discussions with several major retailers about implementing OSA360 with their CPG suppliers. “The response has been overwhelming,” David Newman, Crossmark’s chief insights officer, told PG.

Drastically reducing or eliminating OOS is a must for traditional brick-and-mortar retailers to stay competitive in an industry swiftly adapting to digital commerce, said Bert Clement, CEO of RSi.

“We are thrilled to partner with Crossmark to truly change the game for the retail industry by helping CPG manufacturers and retailers to not just address the massive OOS problem, but finally solve it,” Clement said. “Even our sophisticated alerting solutions are not as effective as they can and should be if the alerts are not acted upon. The breakthrough OSA360 product solves that problem once and for all by closing the loop between the alerting technology and the in-store services needed to correct the OOS issues.”

Other key benefits that OSA360 is expected to provide to retailers and CPG manufacturers include:

•             Optimized supply chain, including significantly increased aggregate OSA percentages

•             Unified vendor OSA scorecard, giving you benchmarks to improve supplier performance

•             Increased innovation success, including better launches

•             Smoother rundown compliance

•             Increased supplier satisfaction, through faster OSA alert response, improved display and innovation management, and a complete ROI model across analytics and labor

•             For retailers, greater customer satisfaction and loyalty

Based on industry research, RSi and Crossmark estimate that sales can increase by at least 1 percent for every 3 percent improvement in OOS performance, which has the potential of doubling growth for many retail industry segments.

“OSA360 will deliver a clear and superior ROI for retailers and CPG suppliers by seamlessly resolving alerts in a very timely fashion through a single source solution,” said Steve Schuckenbrock, CEO of Crossmark.


Leave a Reply

Ready to Rule?

Let us show you how RSi can help power your growth & profitability.

Request a Demo