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Facility Operations

Why are you getting retail stockouts when the system says there’s inventory?

Nick Rakovsky
CEO, DataDocks
Nick is the CEO of DataDocks, the dock scheduling and yard management platform he co-founded in 2013. He leads product strategy and works directly with enterprise warehouse and distribution operations across North America.
First Published: Today
2 min read

Suppose a store reports that the shelf for a particular laundry detergent is empty. You check the system, and it says there’s stock. By the time someone goes to investigate, the shelf has been refilled. The immediate problem is gone, but you still don’t know why a customer couldn’t find the product.

If I can’t see the problem while it’s happening, I like to work backwards. When was the gap reported? What had sold before that? When did the last delivery arrive, and how much of that product did the store record as received? I’d start with those records and see whether they give us somewhere useful to look.

Compare the sales with the deliveries over that period. Is the product selling quickly enough that the store could be running short before the next delivery? Is stock arriving later than planned? Check when the delivery physically arrived as well as when its receipt was entered. Those times may differ, which matters when you’re trying to understand an empty shelf at a particular hour.

That first look won’t explain everything. If you only have daily totals, you may struggle to establish what happened during the afternoon. Missing receipts or inventory adjustments can leave gaps too. I’d use what we have to narrow the questions and be clear about what still needs checking.

If the records suggest stock should have remained, I want to follow its movement inside the store. Was it still on a pallet waiting to be broken down? Had it reached the stockroom? Could the person replenishing the shelf find it? A positive balance also needs checking against damaged goods, shrinkage or an inaccurate receipt. The number alone doesn’t establish that sellable stock was available.

Knowing where the refill came from would help. If someone brought the detergent out of the stockroom, we have a reason to examine how shelf gaps are spotted and replenished. If it came from a delivery that had just arrived, we need to look more closely at supply timing and quantity. Either answer gives us a more specific next step.

I wouldn’t jump straight to ordering more. Extra stock may help if the store consistently sells through what arrives before the next delivery. If the detergent is already sitting in the stockroom, we still need to understand why it isn’t reaching the customer.

For the next incident, ask the team to capture the product, shelf location and time they noticed the gap. Record when it was refilled and where that stock came from. Keep it simple enough to do during the shift.

Choose one product that keeps coming up and work through one delivery-to-shelf cycle. Once we know where it went wrong, we can make a change that addresses the problem we actually found.

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