A theoretical model for testing new product sales velocity at small format retail stores
RAIRO - Operations Research - Recherche Opérationnelle, Tome 36 (2002) no. 2, pp. 157-172.

The present study proposes a theoretical model to test sales velocity for new products introduced in small format retail stores. The model is designed to distinguish fast moving products within a relatively short period. Under the proposed model, the sales of a newly introduced product are monitored for a prespecified period T, e.g., one week, and if the number of items sold over T is equal to a prespecified integer k or more, the product is considered a fast moving product and is carried over to the following sales periods. A slow moving product could be quickly replaced with alternative merchandise in order to make best use of shelf space. The paper first presents definitions of fast and slow moving products, and then a proposed sales test policy based on the model is formulated, where the expected loss is to be minimized with respect to the integer k. Numerical examples based on actual data collected from a convenience store in Japan are also presented to illustrate the theoretical underpinnings of the proposed sales test model.

DOI : 10.1051/ro:2002009
Mots clés : sales test, fast moving product, slow moving product, expected loss
@article{RO_2002__36_2_157_0,
     author = {Sandoh, Hiroaki and Larke, Roy},
     title = {A theoretical model for testing new product sales velocity at small format retail stores},
     journal = {RAIRO - Operations Research - Recherche Op\'erationnelle},
     pages = {157--172},
     publisher = {EDP-Sciences},
     volume = {36},
     number = {2},
     year = {2002},
     doi = {10.1051/ro:2002009},
     mrnumber = {1957986},
     zbl = {1062.90023},
     language = {en},
     url = {http://archive.numdam.org/articles/10.1051/ro:2002009/}
}
TY  - JOUR
AU  - Sandoh, Hiroaki
AU  - Larke, Roy
TI  - A theoretical model for testing new product sales velocity at small format retail stores
JO  - RAIRO - Operations Research - Recherche Opérationnelle
PY  - 2002
SP  - 157
EP  - 172
VL  - 36
IS  - 2
PB  - EDP-Sciences
UR  - http://archive.numdam.org/articles/10.1051/ro:2002009/
DO  - 10.1051/ro:2002009
LA  - en
ID  - RO_2002__36_2_157_0
ER  - 
%0 Journal Article
%A Sandoh, Hiroaki
%A Larke, Roy
%T A theoretical model for testing new product sales velocity at small format retail stores
%J RAIRO - Operations Research - Recherche Opérationnelle
%D 2002
%P 157-172
%V 36
%N 2
%I EDP-Sciences
%U http://archive.numdam.org/articles/10.1051/ro:2002009/
%R 10.1051/ro:2002009
%G en
%F RO_2002__36_2_157_0
Sandoh, Hiroaki; Larke, Roy. A theoretical model for testing new product sales velocity at small format retail stores. RAIRO - Operations Research - Recherche Opérationnelle, Tome 36 (2002) no. 2, pp. 157-172. doi : 10.1051/ro:2002009. http://archive.numdam.org/articles/10.1051/ro:2002009/

[1] E.E. Anderson and H.N. Amato, A mathematical model for simultaneously determining the optimal brand collection and display area allocation. Oper. Res. 22 (1974) 13-21. | MR | Zbl

[2] M.R. Czinkota and J. Woronoff, Unlocking Japan's Markets: Seizing Marketing and Distribution Opportunities in Today's Japan. Probus Publishing Company, Chicago (1991).

[3] A.S.C. Ehrenberg, Repeat Buying. North-Holland, Amsterdam (1972).

[4] D. Grewal, M. Levy, A. Mehrotra and A. Sharma, Planning merchandising decisions to account for regional and product assortment differences. J. Retailing 75 (1999) 405-424.

[5] P. Hansen and H. Heinsbroek, Product selection and space allocation in supermarkets. Eur. J. Oper. Res. 3 (1979) 58-63. | Zbl

[6] R.M. Heeler, M.J. Kearney and B.J. Mehaffey, Modeling supermarket product selection. J. Marketing Res. X (1973) 34-37.

[7] R. Larke, Japanese Retailing. Routledge, London & New York (1994).

[8] G.L. Lilien, P. Kotler and K.S. Moorthy, Marketing Models. Prentice Hall, New Jersey (1992).

[9] P.J. Mcgoldrick, Retail Marketing. McGraw-Hill, London (1990).

[10] A.C. Mckinnon, Physical Distribution Systems. Routledge, New York, NY (1989).

[11] Nihon Keizai Shinbun, Ryutsu Keizai no Tebiki 2000. Keizai Shinbun, Tokyo (2000) in Japanese.

[12] V. Padmanabhan and I.P.L. Png, Manufacturer's returns policies and retail competition. Marketing Sci. 16 (1997) 81-94.

[13] S.M. Ross, Applied Probability Models with Optimization Applications. Holden-Day, San Francisco (1970). | MR | Zbl

[14] S.M. Ross, Introduction to probability models: Sixth edition. Academic Press, New York (1997). | Zbl

[15] D.C. Schmittlein, D.G. Morrison and R. Colombo, Counting your customers: Who are they and what will they do next? Management Sci. 33 (1987) 1-24.

[16] M. Shimaguchi, Marketing Channels in Japan. IMI, Michigan, Mass. (1977).

[17] S.M. Shugan, Product assortment in a triopoly. Management Sci. 35 (1989) 304-321.

[18] G.L. Urban, A mathematical modelling approach to product line decisions. J. Marketing Res. 6 (1969) 40-47.

[19] T.L. Urban, An inventory-theoretic approach to product assortment and shelf-space allocation. J. Retailing 74 (1998) 15-35.

[20] USITC (United States International Trade Commission), Japan's Distribution System and Improving options for US Access. Government printing office, Washington DC (1990).

[21] F.S. Zufryden, A dynamic programming approach for product selection and supermarket shelf-space allocation. J. Oper. Res. Soc. 37 (1986) 413-422.

[22] F.S. Zufryden, New computational results with a dynamic programming approach for product selection and supermarket shelf-space allocation. J. Oper. Res. Soc. 38 (1987) 201-204.

Cité par Sources :