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How do we define product availability?
Product availability is an important supply chain performance measure and appears as a KPI in most companies. However, if the way of measuring it is sub-optimal, we would end up with a supply chain that underperforms on this measure.
Most companies define it at the point of invoicing. Do we have sufficient stocks to service the distributor orders (protect primary sales)? More progressive companies define it at the distributor level. Do our distributors have enough stocks to service the retailer orders (protect secondary sales)? The best definition is, of course, at the retail level where we protect consumer offtake, but the data is not comprehensive.
Availability is normally measured against the customer demand. If you are still measuring it against forecast, it’s a low hanging fruit to start measuring it against actual demand and improve it. A well-known pharma company was actually measuring availability to forecast as the prime measure and reporting a performance of 98%.