In-Stock and Out-of-Stock Distribution

Exhibit 28.13   Stockout and loss of distribution.

Distribution, the metric commonly used for tracking product availability, is usually measured in numeric and weighted terms. It may be weighted in either volume or value.

Numeric Distribution is the percentage of stores handling product.

Weighted Distribution is the percentage of stores handling product weighted by product category store sales. If the weight is in value terms, which usually is the norm, then weighted distribution is the same as the value share of category sales by handlers.

In the context that a product handler may run out of stocks, what is required is the clear distinction between in-stock distribution, out-of-stock (OOS) distribution and loss of distribution.

Consider Exhibit 28.13, which depicts a brand’s incidence of purchase and stocks over four time periods. The brand was in-stock in January and February, and it was out-of-stock (OOS) in March. The brand lost distribution in April because there are no sales, no purchases and no stocks — it did not exist in the store at any time during the month.

Now suppose there was some closing stock in March, and as before, no purchases in April and no stocks by end of April. In this case (Exhibit 28.13b), the status in March changes from OOS distribution to in-stock distribution.

Exhibit 28.13b   Stockout and loss of distribution.

Is this store still considered a non-distributor in April?

No, because the stocks at the end of March are opening stocks for April. These stocks would have sold during the month. So, in this scenario, the store is a handler that is experiencing stockouts for the product.

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