Retailers could directly lose 43% of intended purchases when a product is out of stock, whilst manufacturers could directly lose 25%, as a result of poor availability, according to IGD’s new Shopper Insight research.

46% of shoppers have experienced empty shelves ‘often’ or ‘sometimes’ in their supermarkets, according to IGD’s research, which looked at what shoppers typically did when they found a product out of stock or unavailable.  IGD found that 37% of shoppers would go to another store and 6% would not buy at all, leading to a loss of 43% of intended purchases for retailers.  19% of shoppers would switch to a rival brand, which when added to the 6% who would not buy at all, would lead to a loss of 25% of intended purchases for manufacturers. 

When a product was unavailable in store, a shopper’s action would result in losses to both retailers and manufacturers.  Buying an item at another store would lead to a loss for the retailer, while substitutions of different brands would lead to losses for manufacturers.  Postponing purchase impacts both retailers and manufacturers. 

The main threat to retailers is from shoppers going to another store, as they may decide to switch stores permanently.  However IGD found that only 2% of shoppers would change store if faced with continual out of stocks, suggesting that this is not inevitable.  Shoppers place a higher priority on factors such as familiar store layout, favourable prices and accessible location.  Shoppers might switch stores permanently if poor availability continued, if the products were extremely important to them or if the secondary retailer’s offer matched or exceeded that of their main retailer. 

The biggest threat to manufacturers is that of a shopper choosing to substitute another brand, as they may switch permanently.  The substitute brand would need to meet and/or exceed the shopper’s criteria for food choice if they were to permanently switch, otherwise they would return to their preferred brand or add the substitute product as well.