EURO 2024 Copenhagen
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1810. The flexible shelf space refilling problem

Invited abstract in session MC-50: Retail Inventory Management II, stream Retail Operations.

Monday, 12:30-14:00
Room: M2 (building: 101)

Authors (first author is the speaker)

1. Sandra Zajac
Catholic University Eichstätt-Ingolstadt
2. Moritz Hundhammer
Business School, Technische Hochschule Ingolstadt
3. Michael Sternbeck
Supply Chain Management and Operations, Catholic University of Eichstaett-Ingolstadt
4. Heinrich Kuhn
Supply Chain Management & Operations, Catholic University of Eichstaett-Ingolstadt

Abstract

Shelf space is a fundamental resource in retail and thus 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 practice, however, it is often beneficial to deviate from this tactical shelf plan to reduce in-store replenishment costs. Increasing the facing number 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 facing number 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 paper introduces the flexible shelf space refilling 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 and its suitability to improve the operational shelf space refilling process is demonstrated based on a first case study. Lastly, we give an overview on possible future research directions in this new area of research.

Keywords

Status: accepted

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