Got Inventory? Here’s How to Ramp Up Sales After a Stock Outage
You already know the bad news: Supply chain and stocking issues continue to plague the retail industry overall. But at BrandJump, we are seeing some slivers of good news with manufacturers starting to receive containers and getting ready to replenish stock online.
While inventory situations vary widely and will continue to do so into 2022, “we’re in a better state than we were a few months ago,” said BrandJump Account Manager Aileen English. “I’m expecting Q4 to be strong, especially for those with things coming back in stock.”
But getting inventory back online is only the first step, and ramping sales back up isn’t as simple as flipping a switch. Being out of stock—especially for long periods—has a domino effect on your sales strategy.
When products are out of stock, retailers’ algorithms push those products to the bottom of the site’s search results. And a solid positioning won’t just be reinstated when you’re back in stock—it takes a certain amount of work to gain it back. Brands must be ready to take the steps needed to be competitive and help sales recover.
“You have to find a way to make up for those months without sales,” Aileen said. “This is the right time to lean into different ways of doing that.”
Ways to Ramp Up Sales After an Inventory Replenishment
Time and consistency are one way to build back up both product positioning and sales after an outage. But because many manufacturers experienced such a significant hiatus, bouncing back quickly is critical to maintaining a competitive position. There are a few strategies that can put your efforts into turbo drive:
Participate in retailer marketing programs. Wayfair and Overstock both offer a pay-per-click campaign, which allows manufacturers to pay to artificially promote SKUs to gain exposure—and ultimately more sales. While the upfront advertising costs might make manufacturers hesitant to participate, these programs can make a big impact in a few ways. For one, it helps rebuild a SKU’s customer click history, which ultimately decides a product’s positioning on the site. For retailers that are algorithm-based, clicks highly impact the sort rank. And two, these programs allow you to bypass some of the competition on the site and get seated at the top of the sort rank, which gives you a better chance of customers seeing your product and purchasing.
Some retail partners also recruit manufacturers to take part in their direct marketing activities, like catalog programs or private sales. Being a part of these is an easy way to get in front of the end customer.
Offer promotions with wholesale support. This will be especially key for Black Friday and Cyber Monday sales. Look for ways you can give extra discounts while minimizing the impact on your margin. That might be offering wholesale support of only certain assortments, or offering discontinued products to help get through your inventory and free up warehouse space for when additional stock rolls in.
Work with your retail partners. They’re here to support getting your sales back to a healthy place. Be open and willing to try what they suggest, even if it takes some creative fine-tuning than it might have before the stock outage.
Share your ideas with them as well. If you have a product you want to discount deeply, talk to buyers to see how they can help support. Some retailers are better at this than others, but it’s always worth a conversation on how you can continue to support each other in your partnership.
Ship those in-stock products fast. Don’t diminish the feat of getting back in stock by lagging on lead times. For in-stock products, the goal is to have those look perfect on retailer sites—and that includes showing that a SKU is both in stock and has a short lead time.
If you can’t ensure a short lead time for your whole catalog, make a priority list of products that can ship quickly, and find a way to make sure they leave your warehouse as swiftly as possible.
Then: Don’t Just Get Ahead, Stay Ahead
We all know the supply chain crisis isn’t letting up any time soon. But so far, demand in the home furnishings category has shown very few signs of slowing down. And with low interest rates and permanent work-from-home policies in place, it’s still expected that people will continue to invest in their homes. And what consumers are buying is what’s in stock.
Aileen said that she’s seeing many brands place larger-than-normal orders now, to ensure they can get production priority from factories and be ahead of the to-be-determined timeline for resolving congestion at the ports. Brands should also make sure they have a “never out” list—the top 100 or so products in their catalog—and focus on getting the out-of-stock rate on those products as close to zero as possible.
Those who were “overprepared” for the demand in 2021 reaped big rewards, seeing double- and triple-digit growth while competitors fell out of stock.
“Inventory is such a hot topic right now, and my biggest suggestion for suppliers is to be overprepared,” Aileen said. “Make sure you have stock. Then do whatever you have to do to keep it.”
