Analysis on the Relationship between Shelf Shortage and Commodity Variety Management (about 300 words)

Toshifumi Suzuki, president of Ito Tang Rong and 7-eleven in Japan, said that the four principles for the success of 7-eleven convenience store are: complete products, freshness management, clean maintenance and friendly service. These four points seem simple, only 16 words. However, whether it is complete goods, freshness management, cleaning and maintenance or cordial service, these requirements are often mentioned repeatedly in most enterprises in the industry.

But why does 7-eleven stand out from the industry after adhering to the above four principles?

This phenomenon is exactly what we should pay attention to: how to carry on simple things all the time and make an ordinary thing to the extreme is not a simple thing. Among the above four principles, Suzuki Wenmin puts the integrity of goods in the first place, while the freshness, cleanliness and service attitude of goods rank second.

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Why is it most important for a convenience store with an area of about 100 square meter to have complete products?

Suzuki Wenmin believes that the positioning of convenience stores is to facilitate customers. If customers can't buy the goods they need in the store, the convenience of convenience stores can't be discussed. It is difficult for shops with incomplete goods to attract customers to the store, and it is even more difficult to survive in a competitive business environment. Therefore, complete products have become the first principle of 7-eleven convenience store.

Complete goods, as the name implies, are rich in goods and complete in categories on the store shelves. But the "complete commodity" here is not complete in the ordinary sense. Convenience stores have a limited variety of goods, and the number of single items in 7-eleven stores is about 3,000. If the product structure model of Carrefour comprehensive supermarket is used to measure the category structure of 7-eleven, there will definitely be a big gap in the total number of products. But for 7-eleven, the standard of product integrity is the product structure set according to the basic needs of consumers, aiming at meeting the basic consumption of the target customer groups in the business circle, fully displaying all the products and avoiding the phenomenon of out-of-stock of each product.

So, how does 7-eleven manage the shortage?

There is no excuse for refusing to be out of stock.

Suzuki Wenmin warned shops that successful shops are not only neat and clean, but also friendly. If this store has goods that other stores don't have, or similar food tastes better, it will make consumers feel that this store has certain charm when it is fresher, so it is not necessary to display the same goods all year round, which can enhance consumers' loyalty to the goods. For example, when the typhoon comes and the power goes out, everyone needs candles, and other stores have no goods, only 7-eleven has them. The purchase situation at this time can naturally leave a deep impression on consumers. At this time, consumers can feel loyalty to the goods.

However, the ideas of most managers often run counter to those of customers. For example, if the goods nearby are out of stock, they will think that their stores are out of stock, which is understandable and doesn't matter. But from the customer's point of view, they will think, "What the hell? 7-eleven is the same as other stores! " This will not enhance consumers' loyalty to the store. No matter whether other stores are out of stock, 7-eleven will try its best to have all the goods that meet the needs of customers.

For a convenience store, it is very important to maintain customer relationship. When 7-eleven is out of stock, how should the in-store service staff reply? "Sorry, it's out of stock!" If the store staff leave such a message, customers will go back, and the customer loyalty and dependence that the store has worked so hard to build will be destroyed with the customer's departure.

At this time, if the staff in the store said, "I think you can go to XX store, there should be." The customer immediately felt cordial, that is, standing in the position of the consumer and thinking for the consumer, this sentence also virtually minimized the loss caused by the shortage. The psychological mode of service personnel is mostly not to tell customers that other stores have goods, so other stores will not win customers, so they will say "sorry, there is no goods" and it will be over. Stores should be friendly and sincere to every customer, and everything should be considered from the standpoint of consumers. This is the basic principle of doing business.

For 7-eleven, from the standpoint of consumers, when consumers come to buy things, all the goods that consumers want to buy are displayed on the shelves. It is said that it is too late to replace the goods because of the sudden change of weather, or to find various reasons to prevaricate the shortage, which can not be rejected from the customer's point of view.

Wenmin Suzuki is very opposed to the so-called "empiricism". He has repeatedly stressed that among all kinds of books, the book of tricks is the last one to read. These are just things that sum up the past and will not play any role in the face of the new era. Times are changing, so are customers and values. 7-eleven's entrepreneurial spirit is "destroy first, then innovate".

Consumers in every region have different consumption habits and psychology. When I first joined American 7-eleven, Japanese 7-eleven stores found that many rules formulated by American headquarters were not applicable to Asia.

For example, the average Asian is different from the consumers in Europe and America. Consumers in Europe and America usually buy food for a whole week at once in supermarkets. Most of their refrigerators are above 500 liters, while most eastern consumers have refrigerators with food in their homes below 300 liters. Most Asians think that things frozen in shops are fresher than things kept in their refrigerators. Based on this psychology, consumers will strongly think that what they buy in the store is fresher. This is not sophistry, because this is the shopping habit of Asians. It is precisely because Asian consumers are very sensitive to the freshness of food that few people hoard food and put their purchases in the refrigerator. Based on this habit of not hoarding goods, 7-eleven must place an order accurately to reduce the opportunity loss that may be caused by shortage.

On the shortage of best-selling goods

Almost every store has the problem of out-of-stock and poor inventory of best-selling goods. The reason for these problems is that the root causes are ignored. For example, the problem of poor inventory is actually a "fruit" because of poor single product management.

Suzuki Wenmin even gave an even more extreme example: usually, there is a group of refrigerated freezers on the wall of convenience stores, which display a large number of drinks. What happens if the store puts 100 bottles of milk in this freezer and only sells one bottle a day? This practice is equivalent to accumulating 100 days of inventory. Although this example is a bit extreme, in fact, there are shops that do such stupid things and are indifferent.

At 7-Eleven convenience store, all the goods out of stock are in the refrigerator. If a store doesn't pile up too many goods, it will definitely cause a considerable loss of turnover. Therefore, stores should first understand the overall consumption trend in the market, the preferences of target customers, analyze the operating characteristics of different stores, and choose and display the commodity strategies suitable for their own stores.

Times are changing, and consumers' requirements for product quality are also improving. Once unsalable goods occupy the shelves, the turnover rate of goods in stores will increase. When there are more and more unsalable goods in the store, there is less and less display space for best-selling goods and new goods in the store. Therefore, when determining the final product strategy, stores should first understand the changes in demand and set the product structure in different business circle environments as needed.

How to deal with sudden replenishment

Thirty years ago, when Japan's 7-Eleven only had dozens of branches, it called for no rest all year round. However, in the first month of the new year, almost all the stores could not operate normally, because during the New Year, all the companies were on holiday and could not replenish their goods at all. Therefore, some people suggest that they can find space near the store to increase their inventory. The result was severely refuted by Suzuki Wenmin, who said that we only have dozens of stores now, so this may be able to cope with the past, but what should we do when the number of stores increases to several thousand? So in any case, we must consult wholesalers and manufacturers and ask them to help replenish the goods. We must provide the store with 365 days of uninterrupted service throughout the year.

In addition, for example, in case of severe road traffic congestion such as typhoon, limited road conditions or Mid-Autumn Festival, stores may not be able to replenish goods. If it is an ordinary store, it will probably have no choice but to give up, but 7-Eleven has tried its best to break through the obstacles, just like the Niigata earthquake in Japan on Saturday, June 23, 2004, and all Japanese enterprises and industries are vying for the first place. Suzuki Wenmin, who is on vacation, rushed to the scene and asked the managers to immediately collect information such as road conditions and trucks that may be distributed, hoping to deliver relief supplies to the victims in the shortest time. Faced with this sudden emergency, 7-Eleven made the worst plan, that is, if the road conditions are not good, it can even consider transportation by connecting. It is not a problem to use trucks first, then bicycles, or even people to carry them. The next morning, 7-Eleven finally completed such an almost impossible task by exchanging trucks and helicopters.

Through this case, we can see how much 7-Eleven attaches to logistics and shortage, and how important it is to provide complete services to consumers. Without a complete product, customers will say, "It turns out that 7-Eleven is out of stock!"

For such a successful principle, 7-Eleven has made great efforts.

Seasonal clothing is not as good as starting from consumer demand.

For convenience stores, the change of weather and temperature has a great influence on stores, but many people only believe in thermometers and ignore people's actual feelings. For example, when the weather forecast shows that it will reach 30 degrees Celsius tomorrow, many operators will judge that "it will be very hot tomorrow, so put more summer drinks in the refrigerator", but they often ignore the temperature of the previous day. Therefore, Suzuki Wenmin particularly emphasized the importance of skin feeling. If the temperature was 25 degrees yesterday and 30 degrees today, it must feel very hot today; But if it was 35 degrees yesterday and 30 degrees today, it would be impossible to heat up. Moreover, even if the temperature is the same, if the humidity is very different, it will feel very different.

For example, under normal circumstances, August every year is the peak season for the sale of cold noodles. However, 7-eleven thinks that buildings in Japan usually turn on indoor heating in winter, which will make them feel hot after a long time. Under the assumption that "the weather is cold, but it is hot indoors, so cold noodles can sell well", 7-eleven put cold noodles on the shelves in February. At the same time, if the convenience store assumes that the weather is cold and the cold noodles can't be sold, just put a few cold noodles on the shelf, then the guests won't notice the cold noodles on the shelf at all. Without awareness, there is no way to talk about sales performance. Therefore, every time a new cold noodle comes on the market, 7-eleven will hold tasting activities to gradually promote gas purchase. This is why Suzuki Wenmin emphasized that numbers and skin feelings must be mutually confirmed.

Weather, temperature and even everyone's summer syndrome will affect the sales of all kinds of goods. If the store can't grasp the goods favored by customers at this time, it can't provide consumers with attractive and complete goods. Originally, the store looked at the surrounding environment before placing an order, and then verified the sales results. But in fact, in most cases, we first look at the sales performance, then judge the environment, and then blame the poor performance on the bad weather, customers are too lazy to go out, and so on, making the environment a scapegoat for the low turnover. Therefore, it is impossible to increase the turnover by improvising and using an excuse to break good or ill luck.

People who think that the turnover has fallen sharply because of the rain are too arbitrary.

If it is sunny all the time and it rains suddenly, the sales volume will indeed drop rapidly. However, if it rains for two consecutive days, although it will bring inconvenience to customers, the sales situation will improve on the third day, no matter how heavy it rains. This is the psychology of consumers. The customer's heart will not be affected by meteorological data. Therefore, operating convenience stores must not simply be based on rainy weather, sunny weather and other weather conditions.

Running a convenience store is an industry that feels with heart. The temperature of 20 degrees in early spring may make people feel very hot, but it is cool from summer to autumn. Also at 20 degrees, 40% humidity and 70% humidity feel completely different. Of course, popular goods will also change. As a service practitioner, we must fully understand the above situation.

The store manager just stares at the data in the information system and only finds that the sales of a certain commodity have increased. If you increase the purchase volume, it is likely that these goods will be unsalable when the temperature changes. Therefore, changes can be found by using the data of POS system, and these changes must be considered together with other external factors to find out the reasons for the changes. When you understand the reason for the change, you can make bold assumptions. When a certain condition occurs, what changes should take place and how should we deal with it, and then use POS data to verify whether our assumptions are correct.

The change of temperature will change consumption habits, so when ordering food every day, we should take the change of tomorrow's temperature into account, adjust the basis for the increase and decrease of various commodity purchases, and then list the POS data at the end of the day to see if our assumptions are correct. Through such repeated practice, you can more easily grasp the changes in the market.

Conversion and combination of old and new commodities

Another factor of 7-Eleven's success is its unique way of thinking. When we think of food, we associate it with sales, sales associate it with making money, and making money associates it with selling more. 7-Eleven is associated with being tired of eating delicious food, so there are ways to develop new products, innovate and constantly introduce delicious goods, so that customers are not tired of eating. Local snacks are different from local snacks. Local snacks can only be eaten in designated places, but 7-Eleven products can be bought and eaten at any time, so they will soon get tired of eating. Due to the limited area of the convenience store, the products in the store are eliminated and replaced quickly. The annual elimination rate of 7-Eleven's stores is even above 70%.

So, how do convenience stores launch new products? Is the new product the best? Is it better than the old goods? Can the introduction of new goods stop the sale of second-hand goods?

We can't guarantee these things.

Therefore, even if new products appear, stores can't immediately reduce the order quantity of best-selling products. If the clerk sincerely recommends new products, it will arouse the impulse of consumers to try new products, and will not immediately reduce the sales of the original best-selling products, because some customers will weigh the characteristics of new and old products after trying new products two or three times and still buy old products. At this time, if the secondhand goods are out of stock, it means that the goods that meet the needs of consumers in the store are not complete enough, which means that the store has not done a good job in the management and introduction of goods.

When a store decides to launch a new product, it must immediately make a comprehensive plan so that the old and new products can meet the needs of the whole store. When new products arrive and some old products must be cleared, the store can reduce the price as appropriate. In the past, many shops often cleared their stocks when the seasons changed. At this time, the store didn't sell the second-hand goods as soon as possible, and sold all the goods with great promotion twice. For customers who need it in the future, this store will leave an incomplete impression on customers and lose credit. Ignore the convenience of consumers' needs and only seek their own convenience. The second-hand goods are sold out, but the new goods haven't arrived yet, and the shortage is also a problem. Before the summer is over, the store sells all the summer goods and replaces them with autumn and winter goods, which only shows that the store lacks customer perspective. When the weather is cold, customers want to buy autumn and winter goods, and shops are still displaying a large number of summer stocks, but it is even more stupid if the goods are not in autumn and winter.

For retail stores, the replacement of new and old products is not as fast as possible, and it is not correct to change them slowly. The replacement of new and old products should be combined with the changes of consumers' shopping needs and the changes of weather, and the product display scheme of the store should be gradually adjusted to achieve a complete range of products.

7-Eleven has repeatedly told its stores that retail is a relative industry. Without competitors, I can only think of my own store. Once competitors appear, you can't continue to monopolize. For example, the competitors of convenience stores are not only convenience stores of the same format, but now all large supermarkets and restaurants are sparing no effort to operate cooked food, so these stores are all competitors of 7-Eleven. A takeaway shop can deliver hot hamburgers directly to customers. For this, if the convenience store can't accept the challenge, it will fail.

It was once said that because of competition, the sales volume was only half. Suzuki Wenmin believes that this is not the case. The reason for the sharp drop in store sales is that before competitors appeared, stores ignored the basic principles of store management. So when competitors entered, the usual negligence suddenly appeared, leading to a decline in sales, which is the real reason for the incident. It is absurd to blame the decline in sales on the increase of competitors, because the decline in sales is not caused by mutual competition, but the result of customers comparing the values of various stores in their minds. In this case, the biggest possibility is that the store has problems in terms of complete goods, freshness management, cleaning and maintenance. When competitors appear, these problems in the store will be completely exposed.

Whether it is a supermarket or a convenience store, it is not the fundamental solution to attract customers' attention by offering preferential products to competitors. Shops that rely solely on advertisements and gifts are simply not qualified to engage in retail. If the store can't improve the problems of complete goods, complete goods, freshness management, cleaning and maintenance, and invest in promotional activities, it will be difficult to get good returns. Without the improvement of enterprise's basic operation ability, it will win in the ever-changing business circle.