Consumer responses to shelf-out-of-stocks of perishable products

This paper aims to identify customer behavior with regard to out-of-stocks (OOS) of perishable products (focused on bakery bread) and the resulting inventory performance for these perishable products. Design/methodology/approach – Insights on how consumers behave when their preferred bread product is OOS are derived based on 3,800 customer interviews performed in three stores of a large Dutch grocery retail chain. Next to this, additional logistical information was measured on regular moments with respect to the shelf availability per stock-keeping unit during the day and to waste at the end of the day. Findings – The customer behavior with regard to perishables is observed to be different from that for the non-perishable items. The key observation is that customers have a high willingness to substitute. The incorporation of the obtained knowledge of the observed consumer buying behavior into the existing automated store ordering (ASO) systems is discussed. In the current ASO systems, no distinction is made between perishable and non-perishable products, as it is primarily designed and used for the non-perishables. The authors show that the current ASO can be enriched and extended by taking into account some extra crucial parameters which are based on the observed consumer behavior. Originality/value – One common factor in the research papers published so far is that they primarily looked into the customer behavior for non-perishable items. The current paper on-hand extends these works towards perishable items with a focus on bakery bread.