Shelf based out-of-stocks in the context of employee density

Abstract

The purpose of this paper is to investigate the effect of employee density on shelf based out-of-stocks, i.e. situations when products are physically present at stores, but not on the marked sale positions. In addition, for the first time, these relations were analyzed among different retail formats. By using POS estimation method, shelf based out-of-stock rates were measured for 80 different FMCG products in 97 retail stores. For analyzing the impact of employee density on the average shelf based OOS rate in modern and traditional retail formats, curvilinear hierarchical regression and moderation analyses were used. The results showed that the relation between employee density and shelf based out-of-sock varied among different formats. While it was not significant in convenience stores, in modern formats it was quadratic (stores with too many or too few employees per square meter were related to higher levels of shelf based OOS). The obtained results suggest that store managers should be aware of the effects of employee organization on product availability. The attention was also dedicated to potential problems and managerial implications concerning the employees’ number in retail stores, regarding traditional and modern trading formats.