Supply Chain Report Says Less Shelf Space and Time Available11 Dec, 2008 By: Chris Tribbey
Distributors and content owners can expect less shelf space from retailers, as well as less time on the shelf for products retailers do feature, according to a home entertainment supply chain report from Futuresource Consulting.
“[Lower DVD revenues are] resulting in retailers employing a more cautious approach to ordering stock, thus reducing surplus inventory and freeing up capital and shelf space,” said Futursource consultant Michael Boreham. “Although this is piling on the pressure across the supply chain and increasing the frequency of deliveries, longer term it is hoped that improved forecasting and smaller, more regular shipments will result in fewer returns, which will equate to considerable cost reductions elsewhere in the chain.”
The report concludes that retailers are having a tougher time balancing the need to stock enough product with inventory costs, and that both catalog and new-release titles are being given less leeway before they’re removed.
“As the window between theatrical and sellthrough release continues to shrink, the studios have less time to be creative with additional bonus content; their marketing and promotional support to the retailers can also be jeopardized, so the game is really picking up now and there’s very little margin for error,” Boreham said.
For more information about the report, visit www.futuresource-consulting.com.