KPI: Our In-Stock Rating

Indicator

In-stock rating measures the availability of products for members to purchase. For example, an in-stock rating of 92% means that 92 times out of 100, a member's desired product is available for purchase. Products may be in backstock and not always available on the floor.

Target

Our target is to achieve an in-stock rating of 92%.

Performance

In 2012, we achieved an in-stock rating of 93.5%, and have consistently exceeded our target in the past four years.

In-Stock Rating (%)

We're proud of this result. Yet we know that members want to be able to access the products they need all the time. There are some tangible reasons why we don't aim to achieve a 100% in-stock rating:

• Cost of inventory: The cost of holding inventory is a trade-off (see our Inventory Turnover KPI). Holding more units in stock requires space in stores, a bigger Distribution Centre, more people to manage the inventory, and a higher risk of not being able to sell all our stock. With changing seasons, members don't want a ski assortment in the start of summer!
• Buyer projections: We place stock orders from 12 to 24 months in advance. This is an art and a science. Usually we get it right, but sometimes we have too little (or too much) stock.
• Supply chain realities: Stock levels are affected by volatility in national and international supply chains. Our vendors and factories face their own challenges, such as labour shortages and raw material availability, which can lead to gaps in delivery. We work hard to avoid such problems.

We also measure member perception of in-stock availability. Only 64% agreed that MEC products are available in-store all or most of the time. Online, member perceptions of product availability are much higher, at 82%. We'll continue to measure this and are working to improve our communications in addition to stock availability.

Path Forward

We'll continue to improve floor restocking times, and are striving to achieve a 95% in-stock rating in 2013. We're doing this by improving inventory management and communication flows between head office and our stores. In addition, we're working on an in-store logistics project that will help us to automatically restock when product is running low. The project is currently being piloted in two stores, with the goal of rolling it out across the country by the end of 2013. We're also working to make our entire assortment available to all our members, regardless of where they're located. For example, members can now order bikes from our web store, and in Saint-Denis (which is a small store that carries a limited assortment), they can order in products not carried there, and we'll deliver them to the store for the next business day.