On-shelf availability in British supermarkets is unacceptably low, according to a demand forecasting company that opened for business in the UK this week.

Finnish company Relex claims it can help retailers achieve availability of over 99% in most categories with its software, which runs a series of algorithms based on millions of lines of sales data. The system can even predict the individual uplifts generated in different stores from the same promotion.

Finnish retailer Stockmann increased its end-of-day availability from 93.5% to 99.5% after adopting the system, while wastage fell 30%.

Lauri Loikkanen, planning manager at Tuko logistics, which managers Stockmann’s replenishment, said the inventory could be tightened even further.

“We could lower their stock level more, but it would look like a shop from the Soviet Union,” he said.

The software would also help retailers and suppliers make better informed decisions about promotions, said Relex co-founder Johanna Småros.

She gave the example of a client who had seen that vegetable sales were down. Examining sales data showed that while they were losing sales, the volume had stayed the same because a value campaign had shifted demand to lower-priced products. “Sometimes you want to do that, but it should be a conscious decision, not something that happens by accident,” she said.

“Many organisations are very time-pressed so the easiest solution is to run the same promotion as last year. That’s where I see a big difference - if you can see a pattern then you can do something about it.”

Småros is one of three scientists from Helsinki University of Technology, who developed the technology after conducting research into supply chain collaboration.

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