Name
Abstract | ||
|---|---|---|
In the retail sector many traditional bricks-and-mortar companies have added online sales channels to their supply chains. Unfortunately, even though the combined retailer/e-tailer is becoming a common business model, there is very limited research addressing retail/e-tail operations. To address this gap, this research considers where and how much inventory should be allocated and held at each site for a company that satisfies both in-store and online demand. Specifically, we determine how many and which of a firm's capacitated locations should handle online sales to minimize total cost (holding, backorder, fixed operating, transportation, and handling costs). Our primary findings include the following: (i) when all costs are considered the percentage of sales occurring online plays a critical role in determining the number of sites providing e-fulfillment; (ii) when holding and backorder costs are the only consideration (i.e., the customer pays for shipping), the standard deviation of in-store demand controls where online inventory should be located, regardless of the percentage of demand occurring online; and (iii) an increase in unit shipping costs does not necessarily imply that adding online fulfillment locations will decrease total cost. Results from a computational study illustrate that the model provides good solutions even when demand is correlated or not normally distributed. |
Year | DOI | Venue |
|---|---|---|
2010 | 10.1016/j.cie.2009.09.005 | Computers & Industrial Engineering |
Keywords | Field | DocType |
common business model,online demand,total cost,e-tail organization,backorder cost,online sales channel,e-business,distribution strategy,inventory,online fulfillment location,online inventory,online sale,limited research,in-store demand,dual sales channel,supply chain,normal distribution,satisfiability,business model,e business,standard deviation | Electronic business,Communication channel,Supply chain,Business model,Engineering,Standard deviation,Total cost,Operations management | Journal |
Volume | Issue | ISSN |
58 | 1 | Computers & Industrial Engineering |
Citations | PageRank | References |
11 | 0.77 | 9 |
Authors | ||
3 | ||
Name | Order | Citations | PageRank |
|---|---|---|---|
| Kurt M. Bretthauer | 1 | 300 | 23.24 |
| Stephen Mahar | 2 | 56 | 5.27 |
| M. A. Venakataramanan | 3 | 11 | 0.77 |