At the end of each month, before supermarket inventory checks, we often see food and beverage salespeople as the busiest people in the supermarket. At the receiving area, 'runners and porters' aptly describe their working state, as they handle returns and exchanges of damaged and short-dated products. Every month-end, companies are troubled by the handling of short-dated products. Behind sales growth, many supermarket operators face the thorny issue of 'short-dated products.'

Definition of short-dated products: 'Products that have passed two-thirds of their shelf life are considered short-dated.'

Short-dated products in supermarkets have become a painful issue in the FMCG industry. Faced with this phenomenon, besides passively accepting it, how can we prevent such occurrences in our daily work? Speaking of this, I'd like to start with the impact of short-dated products.

Impact on sales. Currently, terminal supermarkets have a wide variety of products with severe homogenization. In food and beverage categories, within the same category, there are products from different manufacturers. Unless your product stands out in taste, packaging, price, or selling points, and can quickly 'jump out' from the shelf to be purchased by consumers, consumers will pay more attention to product health and safety, especially for products consumed directly. Product shelf life and expiry date are important factors in purchase decisions. Products start to 'depreciate' from the moment they leave the factory and are placed on shelves. Products that retain value are more likely to gain consumer trust and patronage in the terminal. The psychological 'reassurance' is more important than the actual benefit of purchasing. On supermarket shelves, consumers are unwilling to buy food that has passed half its shelf life. Poor shelf life has a significant psychological effect, and consumers quickly switch to competing products. Moreover, short-dated products often end up on the 'blacklist' for removal and exit from supermarkets.

Reducing corporate profits and increasing operating costs. The common method of handling short-dated products is to request policies, promotions, or lower prices from the company to digest them, avoiding returns due to expiration. This method is effective, but think about it: if customers frequently see low-priced clearance sales, how do they perceive the company's image? How is product loyalty maintained? 'A 3.00 yuan tea drink sold for 1.00 yuan—where is the profit? Selling at a loss for publicity is a last resort for companies.' Additionally, supermarkets now have strict inventory assessments, cumbersome return procedures, and after-sales handling that consume the energy of frontline salespeople. All these invisibly increase operating costs.

There are many factors that lead to short-dated products, summarized as follows:

'Blind stock pressure'—Stock pressure first of all does not generate sales! Reasonable inventory is one measure to ensure supermarket supply. However, salespeople often face sales targets, short-term performance assessments, and improper estimates of promotional quantities, which are the roots of blind stock pressure. This often occurs at year-end, after holiday promotions, and at performance assessment deadlines. These are high-incidence periods for stock pressure.

'Inadequate daily store management'—When visiting stores, it's common to see out-of-stock or incomplete displays on shelves. Either a brand is missing a single item, or another is missing a SKU. Stores requiring full-item distribution are always 'incomplete.' When asking promoters, you often hear 'The product is sold out, no stock in the warehouse.' But checking supermarket inventory shows it's still there. From top to bottom, searching shelves and displays, you can't find it. Is the product playing hide-and-seek with us? Is the supermarket inventory data wrong? At month-end inventory, you always find your product in some corner of the warehouse, and checking the expiry date, it's already past half its shelf life. What's worse, it's even our 'star product.' Similar phenomena are nothing new!

'Other reasons'—Personnel changes: Sudden resignations of frontline salespeople (salespeople, promoters) leave many 'aftermaths' for the store, such as inventory status, slow-moving items and their shelf life, and product placement. Problems accumulated earlier need to be reorganized, and salespeople often need more energy and time to familiarize themselves. Store layout adjustments: Every year, supermarkets adjust their layouts to enhance customer freshness. Each adjustment changes the existing layout and displays. Existing products and inventory will undergo a 'major transfer.' If products are not properly categorized and 'pre-arranged' during this process, they may be 'forgotten' in a corner as adjustments deepen. Combined with personnel negligence, this plants the seeds for short-dated products!

Since we know the harm and root causes of short-dated products, how can we avoid the damage they cause to sales and the company in our daily work?

Beforehand: 1. Choose appropriate promotional items and stocking quantities.

Method 1: 80/20 stocking rule: Example: Data analysis of 'Tianwo' leisure food in New World Supermarket Table 1; Conclusion: New World 'Tianwo' leisure food has over 100 SKUs in actual sales, but the top 16 SKUs account for over 80% of store sales. Sort monthly sales data, and those with high sales are 'star products.' 'Star products' not only bring most sales but are often items with high consumer attention and preference, highly sensitive in the terminal market. At any time, promotions on 'star products' can bring a surge in sales. Therefore, focus on 'star products' when selecting promotional items and planning stock quantities. Even if inventory is large, natural sales can maintain fast turnover, so there's no need to worry too much about large inventory.

Method 2: Respect promoters' opinions.

In the store, no one knows the terminal situation better than promoters. Who frequents the supermarket? Why do competing products sell well? Which nearby units need group purchases? Where are the high-traffic areas? Promoters' control over terminal information and resources should not be underestimated. Therefore, before selecting promotional items and planning stock quantities, fully communicate with promoters. We can adopt a consultative approach when planning promotions.

For example: 'Which of our items do customers usually like to buy?' 'Which items do you think can generate volume if promoted?' 'What promotion methods do you think are more effective—buy gifts, special prices, or others?' 'What promotions do nearby group purchase clients prefer?' 'Which promotions can counter competitors?' 'What promotions does the supermarket prefer? If we do them, can the supermarket provide additional promotional resources?' 'Where is the best place for stack displays?' 'Do you think this quantity for this item is appropriate?' 'Is there enough space in the store to stock promotional items?'

Conclusion: Through communication with promoters, we can find more suitable promotional items and get references for reasonable stocking quantities. Fully respecting and adopting their opinions will make promoters more dedicated in future sales. 'Inappropriate promotions' and 'blind stock pressure' can dampen promoters' enthusiasm and bring pressure.

  1. Estimate reasonable inventory.

Idea: 1.5 times safety stock rule. If a supermarket sold 14 boxes of 150g almonds during your last visit, and its current stock is 12 boxes, how much should it order this time? Item | Last week's sales | Current actual stock | Actual order quantity this week 150g almonds | 14 boxes | 12 boxes | 9 boxes = (14*1.5) - 12 Note: 1. Safety stock = last week's sales * 1.5 times. 2. Actual order quantity this week = (last week's sales * 1.5) - current actual stock. (To ensure no stockouts and no excessive inventory, safety stock is set at 1.5 times the customer's actual sales during a visit cycle.)

During: Effective store visits and management.

Ideas:

  1. First in, first out.
  2. Track key indicators during store visits (inventory quantity, shelf life, short-dated product details).
  3. Stacking of inventory products.

Conclusions:

  • Place earlier-dated products at the front to reduce expiration due to improper display.
  • The first responsible person (salesperson, promoter) must track key indicators: inventory products, shelf life, details. Table 2: Visited store: New World Supermarket | Responsible person: Zhang ** | Promoter: Li ** Inventory products | Visit time | Shelf life / Details | Remarks 150g almonds | April 1, 2014 | Dec 2014: 30 packs; Sep 2014: 20 packs; Jul 2014: 10 packs
  1. For stores without promoters, the responsible person is required to visit twice a week and fill in visit records. Salespeople fill in inventory quantity, shelf life, and short-dated product details. For stores with promoters, they are required to fill in and submit weekly to salespeople.
  2. Filling in the form is not 'going through the motions,' but through tracking key indicators, reminding salespeople and promoters to pay attention to inventory shelf life and details, and focusing attention and terminal resources on selling short-dated products!
  • Categorize store inventory stacking (by category: beverages, food, dry goods; by value: high-end liquor, fragile items, milk powder; by unit: whole cases, loose items; by sales: bestsellers, slow movers; by brand).
  1. Promoters and salespeople must be familiar with the store warehouse location and product stacking positions, storing by brand and category, and keeping detailed records.
  2. Note the specific location of product placement in the warehouse (to prevent inconvenience in product cleanup due to personnel changes).
  • 'For floor displays and TGs, always use empty boxes at the bottom to avoid a large quantity of products with half their shelf life after promotions end.'
  • 'Reserve space for products before each stocking, especially for promotional items.'
  • 'Instruct delivery personnel on specific placement positions' (forming a habit so they won't place randomly next time).
  • 'Avoid being adjacent to well-known brands' (well-known brands have high sales and large order quantities. If warehouse space is insufficient, they may 'borrow' your space, covering or padding your products. Unless your sales are higher than theirs in the store).
  • 'Avoid placing inventory near the warehouse entrance' (many people and hands, many delivery companies, and for convenience, they may place items randomly, causing your products to be covered or padded, which is not conducive to later shelf placement and cleanup).

For short-dated products, sometimes they are inevitable! Since they occur, salespeople should not dwell on them. We can adopt reasonable and effective methods to handle them and minimize losses!

Afterwards: Handling short-dated products.

Method 1: Internal digestion within the supermarket. Sell to supermarket internal staff (promoters, temporary promoters, internal management staff). Note: Supermarkets of a certain scale have internal staff ranging from dozens to hundreds. They are usually sensitive to promotional activities. For products with half their shelf life and slow turnover, this method can be used. Utilize promoters' in-store relationships, combine with certain promotional activities, and driven by the 'bargain' mentality, internal digestion is an ideal method. This method is suitable for short-dated products with many varieties but small quantities, all in loose packaging. Buy-gift combinations are most effective. The benefit is that the company avoids 'significant price cuts' and reduces profit loss!

Method 2: Contact community stores near the supermarket for exhibition sales. Note: Through the business representative responsible for the area around the supermarket, contact nearby retail stores, preferably those with a certain cooperation foundation and good relationships. Cooperation can be renting space or providing promotional support. Use the location advantage of community retail stores for exhibition sales. This method is suitable for products with many varieties, large quantities, and whole-case daily necessities (beverages, food). It works well, but the time should not be too long—1-2 days is appropriate. Before the exhibition, it's best to inform other nearby retail stores to avoid unnecessary customer complaints due to excessive promotional intensity.

Method 3: Handle through internal company communication mechanisms. Note: Often after the Spring Festival and holiday promotions, there is a peak in returns. For products with large backlog in stores, after evaluating sales and actual inventory, if it's determined that they cannot be sold within a certain time, consider transferring them to other stores with better sales. Avoid long-term inventory and slow turnover, which miss the 'golden' sales period. Summarize the inventory quantities of stores with large inventory and products. Coordinate through internal communication meetings. Avoid situations where the same product is out of stock in Store A but returned in Store B. This method is more effective for whole-case 'star products' with large inventory.

Salespeople should spend less time handling short-dated products and more energy on effective store management, improving quality sales, and maximizing product value. That is what makes a competent salesperson. With this mindset, the 'short-dated product' problem is not scary, and I believe everyone can do well!

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