RETAIL SINGLE-TRIP IN-STORE REPLENISHMENT

Abstract

Ideally, we want to have a single-trip in-store replenishment. Namely, only a single trip is needed for a retail store worker to have to travel to fill the shelf after a product is received at the store. This can be achieved by having the lot size received smaller than the shelf space less the number of units left on the shelf at the shelf replenishment time. In this paper, we introduce the consideration of the in-store handling cost by the second trip in retail replenishment decision models, given the retail shelf space. We consider the case where products are ordered in multiple packs and there is a part of the distribution handling cost that is for each pack handled. From the concept developed in this paper, there are several future research opportunities to develop optimization models, which will help retail and vendor managers to better coordinate and make decision with regard to the lot size produced, ordered, and delivered in the supple chain.