ECR Iniciative Presidium Nielsen On Shelf Availability Solution

ECR Iniciative Presidium Nielsen On Shelf Availability Solution (OSA) Prague October 12 th , 2012 1 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Agenda # Topic 1 Nielsen approach to OSA - Methodology - Solution & Process - Sample Outputs 2 Possible Next Steps 2 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

What data is required to manage OSA? DATA needed for On Shelf Availability • Granularity: Store By Store • EAN level information • Volume & Value Sales • Stock Positions Allow Root Cause Analysis - Store stock - Orders - Receipts • Frequency: Daily Data available Daily 3 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Nielsen OSA methodology There a 4 main steps in understanding availability using daily data. 1. Understand what’s Normal, or how much should I be selling based on past sales information – Base Line (Demand) • for single SKU, in single store, in particular day 2. Determine Lost Sales in volume, value, as well as the availability rate (OSA Rate) 3. Detect in each store Products with Availability problem 4. Out of Stock root cause analysis 5. Alerts sent to stakeholders to take market action. Fix the issue. 4 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

OSA Rate % OSA RATE PERCENTAGE: The percentage difference between the Demand the Lost Opportunity Units. Used as a directional consistent On Shelf Availability trend allowing to track improvement. 6 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Root causes identification Stock in Transit DC Orders Store Stock DC Receipts Store Orders DC Stock Store Receipts DC Store Orders Unit Sales ROOT CAUSE IDENTIFICATION Stock not available on Shelf False Stock Partial OOS Order not placed Order not delivered Value Sales Negative Stock Unidentified 7 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Solution Related Process & Services 8 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

How does the process work? • Through alerts, each player internal and potentially external is aware of dedicated corrective actions that have to be implemented in order to smooth current difficulties and anticipate the coming days and weeks STORES RETAILER Reports/Charts Buyers /Cat Man Reports/Charts Sales /Cat Man Reports Supply Chain OOS Alerts Stores OOS Alerts Field Rep Top / Bottom Top Management SQL Web Server Daily Data Delivery 7: 30 AM Suppliers Top / Bottom Top Management Projet OSA 9 1: 30 PM Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Sample output by function Supply Chain m OSA Root Causes 10 Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Petr Kriklan Retailer Services Director Email: petr. kriklan@nielsen. com Mobile: +420 773 781 593 Jaroslaw Bogusz Global Account Manager Email: jaroslaw. bogusz@nielsen. com Tel: +39 342 713 6966 11 Copyright © 2011 The Nielsen Company. Confidential and proprietary.