Event Details

Dr Sandra Zajac from LU Leipzig will present a seminar to the Management Science Department

Abstract: Shelf space is the most fundamental resource in retail and consequently it is vital to manage it efficiently. In traditional shelf space planning, the number of facings is defined in advance, and it is assumed that this number will not be changed during the operational replenishment process in the store. In operational store management practice, however, it is often beneficial to deviate from this tactical shelf plan to reduce in-store replenishment costs and improve the visual appeal. Increasing the facings of a product decreases the required effort for replenishing this product as more items fit in the showroom shelf space. However, due to limited shelf space, it will be necessary to reduce the facings of other products which in turn may lead to additional in-store replenishment effort. Adapting the shelf layout further causes rearrangement costs, most notably facing elimination and shifting costs. This talk introduces the shelf space sharing problem in which total in-store replenishment and rearrangement costs are minimized. We illustrate in detail the current process of adapting the number of facings during the refilling process and give some empirical insights to demonstrate the practical relevance of the problem. To provide decision support, a first seminal mathematical model is presented. Finally, we provide a thorough analysis of shelf space sharing in relation to other retail supply chain problems, leading to a comprehensive overview of potential future research directions in this emerging field.