How to Regulate Retail Supply In A Pandemic?
In the wake of the Corona virus outbreak, lock-downs and #stayathome drives has resulted in a global spur of panic-buying, everyone is stocking up on basic necessities- sometimes taking more than their share, leaving retailers bewildered. We are at a point in human history, where Australian government has made regulations for toilet paper sale, and the army is guarding super-markets to stop possible fights over essentials.
In India, with news of the corona virus, a spike in masks and sanitizer demand was felt by February leading to the severe shortages forcing the Government of India to declare them essential commodities.
In an event like a global pandemic, the effective distribution of resources is paramount.
Kolkata currently has a total population of around 45L and a pharmacy count of 4839 including private and government ones.
Mapping the population density around the pharmacies and the accessbility of each pharmacy, the demand-pressure on all of pharmacies was estimated. The gradient moves from red, which are areas which have higher demand to blue which indicates comparatively less expected flow of customers to the pharmacies.
Case Study
Focusing on one of these regions for effect Data Sutram utilised the power of location intelligence to model how the flow of sanitizers had a surge and eventually vanished in a week due to a lack of demand mapping.
Area- 2km radius around South City Mall, Kolkata
Pharmacy Count: 353 [Key-yellow]
Process:
- Calculate the probability(P) of people to go from their house to the pharmacy. This probability measures the relative convenience of person A to travel from his house to Store A to that to travel to other stores.
- The residential & commercial nature of the places are taken into account to factor in destination stores to neighbourhood market.
- The rate of replenishment of stock of the Stores are assumed based on survey results.
Observation:
Following the outbreak, 353 pharmacies (marked in yellow) ran out of their stock of sanitizers in a week or two’s time in-spite of replenishment. However with an indication of demand by Location Intelligence, most pharmacies & distributors could have well planned the replenishment cycle to avoid this choking.
Inference: Location Intelligence and AI can predict impending demand choke-points and lower the possibility of such an event occurring.
This is the level of prediction we can do with the pre-existing data in our system. Wholesalers and pharmacies can access this dashboard and enter their internal data (how much product they are stocking, restocking cycles, etc) to easily pinpoint a whole range of solutions, including:
- Ideal time for bringing in new stock
- Forecasting unexpected demand
- Efficient distribution to avoid stockpiling.
During the corona panic, they can also effectively regulate how frequently they can sell sanitisers to the same customers, preventing some people from hoarding all of it. There has been a total break down of demand and value, currently Rs 50 santisers are being sold at Rs 200 in order to control it- but location intelligence could be a more effective and cleaner way to solve this problem.
