The impact of demand dependency on inventory and freshness in complementary product pricing and shelf space allocation
摘要
This study presents a novel approach to pricing and shelf space allocation for complementary fresh food products, addressing critical challenges in the retail sector. The importance of this research lies in its potential to significantly enhance profitability and operational efficiency for retailers dealing with perishable goods. The demand for such goods is profoundly influenced by their freshness, determined by the time remaining until expiration, as well as by their in-store visibility. The proposed comprehensive framework incorporates a variety of factors influencing demand, including inventory levels, pricing strategies for both the primary and complementary products, and freshness metrics. Through rigorous analysis, the study determines the optimal pricing and shelf space strategies that not only enhance product visibility but also maximize overall retailer profits. The findings reveal a substantial potential for profit enhancement through the optimization of these decisions, identifying four key decision variables that significantly impact outcomes. This research provides actionable insights for practitioners and contributes to the ongoing discourse on effective retail management strategies in the perishable goods sector, emphasizing the importance of an integrated approach to pricing and shelf space management. By addressing these challenges, the study offers a valuable framework for retailers to navigate the complexities of perishable product management and achieve sustainable growth in competitive markets.