Business Intelligence and FMCG Glossary: #numericdistribution
Numeric distribution
What is numeric distribution?
Numeric distribution is the number of outlets in which a product or reference is available. This indicator is generally compared with the total number of points of sale in the universe studied to calculate the percentage of numeric distribution.
Why is tracking the distribution level so important?
The percentage of numeric distribution allows measuring the coverage of each product or reference in a distribution network. This is a key indicator for evaluating the sales potential of a product and calculating sales forecasts.
Innovation products in particular are very sensitive to this and achieving an adequate level of numeric distribution, and therefore their availability for shoppers, is a key factor in their commercial success.
Numeric distribution can be theoretical or observed:
- Theoretical: corresponds to the level of distribution agreed with the customer
- Observed: corresponds to the actual level of distribution found during visits of the sales representatives or calculated with sell-out data.
When compared with weighted distribution, we can determine that:
- If numerical distribution < weighted distribution: the product is present in fewer stores, but those stores have a greater impact on the business.
- If numerical distribution > weighted distribution: the product is present in many stores, but not in the ones that are most important to the business.
