Almost a third of high street retailers are gambling with stock shortages over the Christmas period and passing pressure back onto the supply chain, according to a study by cloud computing company NetSuite.
It found that 44 per cent of retailers will be keeping stock levels very tight even in the run up to Christmas, and 29 per cent would rather risk running out of stock this Christmas than have excess product on their hands.
Pressure is being passed back to suppliers, with 40 per cent asking suppliers to maintain discounts or cut prices, even if they have been ordering lower volumes.
The study, carried out among some 250 UK retailers by The Opinion Research Business for NetSuite, also found that 47 per cent of retailers are using more suppliers to enable price comparisons and help drive down costs; and 30 per cent of respondents are asking their suppliers for shorter order fulfilment times.
Roman Bukary, head of industries marketing at NetSuite, said: “It’s hugely encouraging to see UK retailers take an optimistic view of trading conditions as we move towards 2011. However, keeping stock low and relying on suppliers to bridge any gaps in supply will stress retailer-distributor collaboration, require seamless communication and in case of any breakdown in the trading network, might leave shoppers disappointed.”
This survey also found that the UK high street is yet to realise the full potential of the web to boost sales. While 80 per cent of retailers questioned had some form of online presence, as many as 53 per cent of these didn’t actually generate any turnover from their e-commerce operations.