Delivering more accurate demand forecasts has been the goal of Lokad since its creation. However, no matter how good are the forecasts, if underlying inventory records are inaccurate, the whole inventory optimization, as delivered by Salescast, is off.
A bit more than one year ago, we were launching Shelfcheck, a tool to detect out-of-shelf (OOS) problems based on the analysis of improbable sales drops. However, Shelfcheck is only palliative care as OOS alerts are produced after the beginning of the stockout problem.
Today, we announce the launch of Phantomscan, a new webapp that help retailers getting rid of their phantom inventory. In short, by analyzing patterns observed in past inventory corrections, Phantomscan predicts which SKUs are most likely to have inaccurate records. Instead of having employees performing a classic cycle count, they focus directly where counting is needed the most.
There are not that many empirical studies that have been conducted about inventory accuracy in retail, however the few that exist are stunning: in all studies, inventory records have been found to wildly inaccurate at the store level.
Although computerized tracking of inventory at the stock keeping unit (SKU) level is commonly assumed to be accurate, we found discrepancies in 65% of the nearly 370,000 inventory records we gathered from multiple stores of a leading supply chain. DeHoratius and Raman (2004)
The problem is serious because phantom inventory acts as an invisible hand lowering service levels on all SKUs impacted. Yet, it seems that the only option remains cycle counting which happens to be a very expensive way to improve inventory accuracy.
Phantomscan, in contrast, is designed to make the most of each minute spent on counting inventory. It's a curative care against OOS, helping the retailer to remove inaccuracies before OOS problems emerge. With an aggressive per-store pricing, we believe that Phantomscan will be suitable for retail companies of any size.
At this point, we are looking for volunteers to take part in Phantomscan beta. Early adopters will benefit from Phantomscan free of charge for the duration of the beta, plus 6 months after the end of the beta. Furthermore, beta users will also get the chance to influence the development of the webapp toward the features that serve them the most.
To take part in the beta, just drop a line to firstname.lastname@example.org.