Tips to stop product stockouts
By Kathy Cruz

Follow these proactive measures to prevent stockouts.

Is your busy season coming to an end? If so, consider how often you ran out of a product during the busy season. Whether you’re a new or experienced gift shop owner, stockouts happen.


A stockout occurs when a retailer runs out of a product that customers want to purchase. Stockouts can hurt independent retailers because they lead to lost sales, decreased customer satisfaction and sometimes damage to a store’s reputation. Frequent stockouts can also drive customers to competitors, eroding a retailer’s customer base and potentially impacting long-term profitability.


However, store owners can take proactive measures to avoid the potential problems caused by stockouts.



Inventory management + replenishment

Invest in a reliable inventory management system to track stock levels in real-time. Sometimes these systems can manage stock across multiple locations.


Retailers can also use the software to set reorder points. Use this feature in your system to alert you if your stock is low or at a level where it’s an ideal time to reorder.


"Store owners can take proactive measures to avoid the potential problems caused by stockouts."


To quickly replenish, keep a buffer stock (safety stock) in your storage room and warehouse to protect against unexpected demand surges or supply chain disruptions.



Demand forecasting

Analyzing sales data can help you predict future demand. Look for patterns and trends, such as peak tourist seasons or popular souvenir items. Offer exclusive products that can only be found in your shop. Local makers in your community or online might offer this type of service. When you establish a relationship with them, they can provide unique souvenirs that showcase local culture, landmarks or traditions.


Sell-through rate is a key metric for store owners that measures percentage of inventory sold within a specific period. Check your point-of-sale or inventory system to see if this is a metric that is provided in your reports.



Supplier relationships

Develop and maintain relationships with suppliers to ensure timely deliveries and better terms. Having reliable suppliers can reduce lead times and help you manage inventory effectively.


Avoid relying on a single supplier, though. Having multiple suppliers reduces the risk of stockouts. Maintain relationships with backup suppliers who can step in if your primary suppliers face issues.



I want you to be set up for success in managing your shop’s cash flow. By being proactive, especially during peak seasons, you can avoid stockouts.


Not only will you improve cash flow, but you’ll also ensure you’re consistently meeting customer demand and maintaining a positive shopping experience.


Kathy Cruz is a retail business coach and host of the Savvy Shopkeeper Retail Podcast. Reach her via email at: kathy@savvyshopkeeper.com. Learn more on her website, www.savvyshopkeeper.com, and Instagram, @savvyshopkeeper.