Stockout-Based Customer Switching and Its Impact on the Supply Chain(2016)
How do in-store operational decisions of retailers affect supply chain members? How do retailer actions contribute to stockout occurrence? Retail stockouts mean lost sales and increased difficulty in managing inventory due to customers switching from an out of stock item to a substitute. This dissertation adds to the extensive literature on substitution and stockout occurrence in a number of ways. First, it presents a heuristic for a retailer who stocks items according to a target service level. The heuristic shows reasonably well performance in a simulation experiment over various levels of customer willingness to substitute. The results also suggest the need to differentiate service measures over dimensions beyond the standard item fill rate. Secondly, a unique dataset with actual on-shelf stockout occurrences is used to empirically test the relationship between stockouts and the retailer’s allotted shelf space for items it receives in set case pack sizes. This data sidesteps the research issue of identifying stockouts by manual audits or estimation methods using sales or perpetual inventory data. Lastly, the dissertation uses both the simulation values and the archival store data for nine different unit fill rate measures: primary, secondary, and total fill rates for an item, for a customer, and for a brand. Bringing together these performance measures enables insight into how a retailer’s internal tactical planning also affects customers and suppliers in the retail supply chain.
- Supply chain
DegreeDoctorate of Supply Chain Management
Field of studySupply Chain Management with a Management Science minor
Citation InformationHeidi P. Celebi. "Stockout-Based Customer Switching and Its Impact on the Supply Chain" (2016)
Available at: http://works.bepress.com/heidi_p_celebi/7/