The Impact of Supplier Inventory Service Level on Retailer Demand
| Autor: | Ananth Raman, Nathan Craig, Nicole DeHoratius |
|---|---|
| Rok vydání: | 2016 |
| Předmět: |
Supply chain management
Service delivery framework Strategy and Management Supply chain 05 social sciences Management Science and Operations Research ComputingMilieux_GENERAL Empirical research Order (business) Service level 0502 economics and business 050211 marketing Customer satisfaction Business 050203 business & management Consumer behaviour Industrial organization |
| Zdroj: | Manufacturing & Service Operations Management. 18:461-474 |
| ISSN: | 1526-5498 1523-4614 |
| DOI: | 10.1287/msom.2016.0582 |
| Popis: | To set inventory service levels, suppliers must understand how changes in inventory service level affect demand. We build on prior research, which uses analytical models and laboratory experiments to study the impact of a supplier’s service level on demand from retailers, by testing this relationship in the field. We analyze a field experiment at the supplier Hugo Boss to determine how the supplier’s inventory service level affects demand from its retailer customers. We find increases in historical fill rate to be associated with statistically significant and managerially substantial increases in current retailer orders (i.e., demand, not just sales). Specifically, a one percentage point increase in fill rate, measured over the prior year, is associated with a statistically significant 11% increase in current retailer demand, controlling for other factors that might affect retailer demand. We explore the drivers of this demand increase, including changes in retailer assortment and order frequency. We discuss features of a retail buyer’s decision context identified through our field work that may explain the magnitude of the relationship we observe. |
| Databáze: | OpenAIRE |
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