We know in-store inventory visibility is crucial for brand manufacturers and the retail industry – after all, stockouts cost them an estimated $1T annually. So recent news of billion dollar “unicorn” valuations for companies with technology aimed at attempting to solve this problem is a big deal and the latest indication that the market is heating up.
And not a moment too soon, as brands and retailers continue to battle the “Amazon effect” and struggle with BOPIS (Buy Online and Pickup in Store) and other combinations of e-commerce and brick-and-mortar shopping. The starting point for any effective solution is an accurate and automated view of what is actually on the shelf for sale, and where. But this most critical visibility has been the industry’s black hole in an otherwise automated supply chain.
Why? Because the requirements for what it takes to solve the problem are significant – and the bar keeps getting higher. Thus the industry attention on new tech and new solutions.
Retail is in the midst of massive disruption. Helping the retailer and brand partners ensure the right product is on the shelf in the right place is central to the future of retail and to ‘clicks’ and ‘bricks’ shopping in the future. And, central to Pensa.
Out-of-stock is a trillion dollar problem for the industry, so it’s no wonder we are starting to see billion dollar unicorns. But as valuations go up, don’t lose sight of the complexity of the challenge, the evolving industry needs, or the magnitude of the total potential benefit. Understanding all of these dimensions is the real key to solving this historically intractable problem. We’ll comment more on what to expect from a solution and how to evaluate the alternatives in a later column.