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Sustainability 2017, 9(1), 12; doi:10.3390/su9010012

The Retail Chain Design for Perishable Food: The Case of Price Strategy and Shelf Space Allocation

1,2
and
3,*
1
Jiangsu Key Laboratory of Modern Logistics, School of Marketing and Logistic Management, Nanjing University of Finance and Economics, Nanjing 210046, China
2
Business School, Nanjing University, Nanjing 210093, China
3
School of Economics and Management, Changshu Institute of Technology, Changshu 215500, China
*
Author to whom correspondence should be addressed.
Academic Editor: Marc A. Rosen
Received: 25 September 2016 / Revised: 7 December 2016 / Accepted: 21 December 2016 / Published: 23 December 2016
(This article belongs to the Section Economic, Business and Management Aspects of Sustainability)
View Full-Text   |   Download PDF [850 KB, uploaded 23 December 2016]   |  

Abstract

Managing perishable food in a retail store is quite difficult because of the product’s short lifetime and deterioration. Many elements, such as price, shelf space allocation, and quality, which can affect the consumption rate, should be taken into account when the perishable food retail chain is designed. The modern tracking technologies provide good opportunities to improve the management of the perishable food retail chain. In this research, we develop a mathematical model for a single-item retail chain and determine the pricing strategy, shelf space allocation, and order quantity to maximize the retailer’s total profit with the application of tracking technologies. Then the single-item retail chain is extended into a multi-item one with a shelf space capacity and a simple algorithm is developed to find the optimal allocation of shelf space among these items. Finally, numerical experiments and real-life examples are conducted to illustrate the proposed models. View Full-Text
Keywords: food retail chain; shelf space allocation; perishable food; pricing strategy; quality deterioration food retail chain; shelf space allocation; perishable food; pricing strategy; quality deterioration
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Xiao, Y.; Yang, S. The Retail Chain Design for Perishable Food: The Case of Price Strategy and Shelf Space Allocation. Sustainability 2017, 9, 12.

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