Tesco is simplifying its promotional programme on fresh food and piloting new initiatives to drive efficiency from back of store to shelf, as part of its commitment to be "number one for availability".
Speaking to The Grocer at ECR Europe last week, Tesco boss Sir Terry Leahy said tackling out of stocks was one of the key priorities driving Tesco's trading strategy, although great strides had already been made in this area.
"We try to avoid situations where you get big pockets of stock. Many of the products we sell in our stores are delivered twice a day.
"That means the stock arrives exactly when you want it to, and goes straight on the shelf because there's space on the shelf."
The Grocer understands a series of instore initiatives to improve availability are about to be tested. These include better labour scheduling and more regular shelf filling in a bid to drive efficiency in the last 50 yards' of the supply chain from the store back door to the shelf.
In addition, Tesco is looking to simplify its promotional programme to iron out peaks and troughs in demand in categories where on-shelf availability is causing concern, while suppliers have been asked to deliver in case sizes appropriate to store formats.
Continuous replenishment wave deliveries of goods into stores twice daily is now being extended to fresh, after successful trials on ambient.
This will reduce inventory and improve availability, said IT and logistics director Philip Clarke, also at ECR. "It's a brave step. But we pulled it off on ambient so we are confident we can do it on fresh."
The size of the prize was identified at a recent supplier conference where Tesco said supply levels to RDCs were typically 99% and service levels to stores were around 95%. However, on-shelf availability as measured by instore pickers for Tesco.com was as low as 90% in a handful of cases.
TNS Superpanel data for the 36 weeks to March 30 reveals more than 15% of Tesco customers emerged from shopping trips claiming they were unable to purchase everything they wanted.
When customers were asked, Were you able to buy everything that you wanted?,' Morrisons came out on top with a 91% yes' rating, ahead of Somerfield at 89% and Asda at 86%. Tesco and Sainsbury trailed at 84% and 83% respectively.