STOCK OUTS: NOT ON SAYS SAFEWAY Working with frozen foods is always difficult but Safeway is taking a zero tolerance attitude to out of stocks says Sheila Eggleston Three little words that strike fear into any multiple's logistics department ­ out of stocks. Availability is one area all the multiples struggle with, but frozen food is recognised as the worst offender. It not only annoys the consumer, but also adds friction to supplier/retailer relationships. Our own weekly shopping survey confirms there are huge problems in coping with the daily recharging of the freezers, and most stores admit it's the least popular job on the shop floor. Even the temptation of a warm, cosy padded jacket cannot induce staff into refilling freezer cabinets willingly or quickly enough. Safeway, the best performer in The Grocer 33 weekly shopping survey, is taking a zero tolerance approach to frozen out of stocks. This is highlighted by the investment in a new mega depot in the south west where summer is big business. "Although the eclipse didn't happen, it brought people into the south west," says director of supply chain operations Mark Aylwin. "But generally availability isn't as good as it should be and working with frozen is always difficult. There's constraint on the shelf, on the floor and in the back room. "You have to keep products frozen, so you can't take too much onto the floor at once. It's not like ambient where you can work your way down an aisle with many products. "With frozen you have to be in and out quickly because you don't want it thawing." Safeway takes responsibility for the problem but believes manufacturers can help. "There's more product in a small space which needs to be frequently filled. We take a little but often approach ­ unproductive but it works. Case sizes matter and smaller ones from supplier would help. If it's well presented, it can be taken straight out and off loaded quickly." Aylwin claims the biggest challenge is promotions. "On ambient you can have overspills and gondola ends. In frozen you can't move out of freezers." Getting the range right, giving it space and sticking with the bestsellers seem to be the key rules for success. But, more importantly, the pooling of information more speedily is at the top of everyone's wish list. High hopes are raised with the influx of sophisticated IT systems such as Asda's link up with Wal-Mart's Retail Link data system. Birds Eye Wall's trading director Neil Jones says: "Systems such as Asda's Retail Link where unsold and missing products can be tracked will be a plus. Asda is putting huge focus behind it." Birds Eye Wall's claims the top eight multiples have an average out of stock level of 8.1% of its products equal to a missed opportunity of almost £250m across the total market if all products were fully stocked. Its worst out of stock is ice cream with Wall's ice cream having an estimated out of stock level of 14%. Fish, too, has seen a rise in out of stocks, while green veg does better with only 3%. The company says even closer relationships with retailers are needed to resolve this problem. "Some retailers don't give enough resources to frozen to cope with turnover. Frozen food is a highly promoted area so there will be high peaks which need to be managed throughout the supply chain," says Jones. "If the sun shines its difficult to keep up with stock levels, but we can accelerate programmes which are seasonal." Frozen veg supplier Fisher Frozen Foods also says retailer information is vital and is interested in seeing how Tesco Information Exchange and Sainsbury Information Direct shape up. MD Stephen Waugh says: "If you know what they are selling from one week to the next and the number of stores, you have a better chance of working out demand. "Promotions are one of the worst forecasting moments. Drop the price of peas in one store, and the others will hit back." Waugh says EDLP has helped smooth out the peaks and troughs the promotions used to create, with 98% of orders delivered on time. {{FOCUS SPECIALS }}

Topics