Dandruff, or The Long Tail
Thursday 24th May 2018
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The Long Tail

Just how slowly stock items really move.

Society's appetite for variety shows no signs of slowing. Firms who measure it record >10% a year, even higher in consumer electronics.

This presents new challenges which few have mastered. Many haven't even seen it as a strategic issue yet.

With such myriad responses, it's more helpful to plant seeds than to try and diagnose or solve.

The winners will be those who master it, not those who run away. Range reduction is usually a red herring, especially where it diverts management attention from mastery.
(Author successfully masterminded a range reduction program in a marketing led company. So I know what can be done, but only when it's the right thing to do.)

Some general comments may help:-

Manufacturers see huge (aggregate) quantities, yet users largely buy ones.

'The Long Tail' (Chris Anderson, rh books) suggests the tail is more profitable than the (commoditised) head.

Retailers, in particular, always talk only about fast movers. A typical conversation might go:-

  1. How fast does the average item move in the shops?
    • White T shirts sell nnnn a year
  2. How much is that per shop?
    • (Pause) Er.. about nn
  3. That's all T shirts, what about individual sizes?
    • (Longer Pause) Er.. about n
  4. Does everything sell as fast as white T shirts? (and so on)
(Half the range contributed 3% to sales, the average item only sold once every 3 weeks, and 5% of goods, even if stocked in 1's - which they were not - would more likely be leftover than sold.)

We may need help understanding and controlling slow movers, please contact us

Any fool can make things bigger or more complex. It takes genius and courage to do the opposite. Einstein
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