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This was a good question on vaccine distribution that got buried by Gamestop frenzy. Why don't we have accurate data on inventory and where they are in the chain? 1/n https://twitter.com/JamesSurowiecki/status/1353553464585048065
Missing inventory is very common. National Retail Federation (NRF) estimates that the shrink rate (unaccounted inventory%) was 1.38% in 2019
https://cdn.nrf.com/sites/default/files/2019-06/NRSS%202019.pdf
https://cdn.nrf.com/sites/default/files/2019-06/NRSS%202019.pdf
Paper by Nicole de Horatius shows there is a tremendous variance in inventory inaccuracy between categories and locations.
https://www.jstor.org/stable/20122416
https://www.jstor.org/stable/20122416
Sources of unaccounted inventory? Often guessed reasons are shoplifting and theft. But, inventory diversion, in-transit inventory, administrative errors, poor pricing, cash counting, and slow updating of books are all reasons. Much of this is present in vaccine distribution.
Even efficient Walmart supply chains faces inventory shrinkage. Fixing it requires a multi-pronged approach. See the recent (mis)steps with AI-solution to fixing this. https://www.wired.com/story/walmart-shoplifting-artificial-intelligence-everseen/
Supply Chain coordination requires decentralized control policies, but also a lot of centralized accounting. Pure delegation doesn't work as what's good for the store is not necessarily good for the whole chain (and vice versa). n/n.
