I work in grocery retail and have a significant amount of knowledge regarding store level operations, logistics, and the manufacture of the goods you buy in the stores. The reason for this post is due to the sheer amount of customers, along with Instacart shoppers, who seem completely oblivious as to why products are out of stock. For some, this will seem like obvious information. For others, I hope to shine a light on what’s going on and where we are at currently, and hopefully when things will get better.
Stage 1: At the store level, most grocery stores have a surprisingly large amount of inventory. While they may run out of one brand, there is usually another (or more) available. Have you ever shopped for groceries the day before Christmas? You’ve probably noticed some out of stocks (oos). This is after roughly 4-5 days of heavy volume. In many cases, the store had the opportunity to stock up on common items for that particular holiday that the distribution center (DC) had already bought. Now, when panic shopping happens, and it happened suddenly without warning, it’s like holiday sales on steroids. Your grocery store had zero time to stock up, nor did the DC. At this level of buying/hoarding, shelves empty out in about 2-4 days of the ‘good stuff,’ and when the people who follow are left with no other choice but to buy whatever is left. At this point, store volume is up over 600%, and I’ve seen much higher.
Stage 2: At this point, the DC is scrambling to purchase from the manufacturers. The supply is there, but now there is a logistical nightmare. Retailers, as well as the DC and manufacturers, operate on a pretty strict labor budget. There aren’t enough ‘pickers’ in the DC to pull the massive orders generated by the stores. Extra deliveries cannot happen because there aren’t enough truck drivers, including contracted drivers. Things have to slow down, so supplies get allocated, say 1500 cases per store or whatever will fill one truck up, and one only. DC’s do have a maximum service level and ours was operating well beyond capacity.
Stage 3: This is where we are at now. Shopping has calmed down, but with kids out of school, families being at home, and many restaurants closed, many have no option but to buy groceries. Volume is still heavier than normal but not crazy. Store shelves look better, but there are many oos. Now the manufacturer’s are feeling the pain. They either don’t have the labor, the resources (base ingredients), or the manufacturing capability, or all of those, to produce the amount needed to stock the grocery store shelves across the entire country. They are now streamlining operations by only producing their most popular items. The others are suspended indefinitely. So if you can’t find your favorite ultra-soft-5-ply toilet paper, that’s why.
I should note that the organic market isn’t as deep as you may think, so these items will take time before they become readily available again. They are out there, but it will be spotty and there will be constant oos.
Stage 4 – Recovery: If we happen to be at our peak of the whole epidemic right now and no other ‘events’ take place, it will take 4-6 weeks before things appear to be normal, possibly longer. They will not be normal, but you will be able to find most everything you want. It will take months before manufacturers will be able to have their full line of products available. I’ve heard some estimates as late as October but no one truly knows. The act of panic buying has created a ripple that runs far deeper than your grocery store’s shelves.
As if it hasn’t been said enough, grocery stores will never shut down. They will continue to operate in some capacity. I suspect after this crisis we will be looking to update our online ordering and delivery processes to provide for anyone who can’t leave their home during such an event. After all, we work for you! So please, do not panic buy. Do not hoard. Help us to help you!
If things get worse, a second wave is very possible. I hope people learn. If it does, it will absolutely crush the grocery industry. Things are very fragile right now. If people stay calm and trust us and what we are doing to provide, we can deliver. Maybe not to everyone’s expectations, but you won’t go hungry.