Product availability is a critical aspect of customer service for retailers and manufacturers. When product is out of stock (OOS), both retailers and manufacturers may suffer depending on the demand-side characteristics, such as whether consumers are more loyal to the store or the brand. While both retailers and manufacturers contribute to OOS situations, the supply-side characteristics, such as whether the retailer or manufacturer is responsible for in-store fulfillment [i.e., traditional versus direct store delivery (DSD) distribution], may impact OOS performance. DSD involves the manufacturer bypassing the retailer's distribution center and delivering product directly to the retailer's individual stores. This paper considers demand- and supply-side issues simultaneously to determine the implications of stockouts for both retailers and manufacturers using an agent-based simulation. An agent-based simulation allows for consideration of these issues under repeated OOS situations to determine the overall impact to retailer and manufacturer performance.
Abstract In globalized factor markets, firms face threats of resource scarcity, which challenge purchasing managers in interpreting signals about complex and uncertain factor‐market conditions. When future resource supply is threatened, purchasing managers are affected not only by the expected scarcity but also by the uncertainty of the scarcity threat. We investigate how expected resource scarcity and scarcity uncertainty affect managerial attention to scarcity perceptions, which, in turn, impacts the likelihood to respond to the scarcity threat by collaborating with the major supplier. We collected data from 203 purchasing managers about their experience with a scarcity incident and developed new scales for assessing perceived scarcity. Our findings indicate that expected resource scarcity results in increased levels of managerial attention while scarcity uncertainty reduces managerial attention. Importantly, managerial attention mediates the effect of expected resource scarcity and scarcity uncertainty on purchasing managers’ propensity to collaborate. The results illustrate the contrary impact of expected resource scarcity and scarcity uncertainty on purchasing managers’ attention and highlight managerial attention as an important behavioral consideration to understand how purchasing managers mitigate environmental risk. Finally, we identify individual (responsibility, experience) and organizational (trust) factors that increase purchasing managers’ attention to scarcity threats and collaboration.
Purpose The purpose of this paper is to compare and contrast customer perceptions related to satisfaction with conventional grocery stores as compared to specialty grocery stores. The study examines store attributes of product assortment, price, quality, and service in order to determine which attributes have the greatest impact on store satisfaction for each store format. Design/methodology/approach A mail survey was sent to a sample of specialty and conventional grocery store customers. The ten state sample was drawn from US households located in postal (ZIP) codes in areas where national specialty stores (e.g. whole foods) were located. Findings Perception of satisfaction were higher among specialty grocery store customers compared to conventional grocery store customers. For both store formats, store price, product assortment, service and quality positively influenced satisfaction. Stepwise regression indicated that each store attribute contributed differently to store satisfaction for conventional and specialty store formats. Research limitations/implications The results demonstrate that price, product assortment, quality, and employee service influence store satisfaction regardless of store type (conventional stores or specialty stores). However, the degree of influence of these attributes varied by store type. The results imply that while specialty store shopper satisfaction characteristics are clearly delineated, conventional store shopper characteristics are more difficult to pinpoint. Research limitations include a sample that is more highly educated and has higher incomes than the average American household. Originality/value Despite the growth of new product categories and new industry players, few studies have investigated customer satisfaction within the retail food industry. Comparisons of specialty and conventional food stores are equally scarce.
Abstract Supply chain disruptions pose an increasingly significant risk to supply chains. This research develops a framework to examine the threat of potential disruptions on supply chain processes and focuses on potential mitigation and supply chain design strategies that can be implemented to mitigate this risk. The framework was developed by integrating three theoretical perspectives—normal accident theory, high reliability theory, and situational crime prevention. The research uses a multi‐method approach to identify key safety and security initiatives (process management, information sharing, and supply chain partner and service provider relationship management) that can be implemented and the conditions under which each initiative is best suited. The research results illustrate that the depth and breadth of security initiatives depends on top management mindfulness, operational complexity, product risk, and coupling.
Efficient Consumer Response (ECR) is an industry‐wide initiative that is commonly believed to have fallen far short of its promised efficiencies and value. Many believe that unrealistic expectations among grocery industry participants are primarily at fault for this shortcoming. The level of internal and external change required to make desired outcomes a reality have been underestimated and poorly understood by prospective participants. While change has been slower than desired, many firms have collaborated effectively and achieved significant results through coordinated supply chain activities. This research uses case studies to illustrate successful collaboration in the grocery supply chain and explores the success factors inherent in such efforts.
ABSTRACT Today's rapidly changing and competitive marketplace has forced channel members to devote increased attention and resources to providing consumers with a seamless delivery of products and services. This seamless delivery occurs through social integrative relationships between channel members, supported by the application of information technology. Achieving integration is a difficult task that may vary based on whether a product or a service is involved. This paper proposes that manufacturer integrative relationships with product suppliers may develop with lower levels of seamless delivery when compared to manufacturer integrative relationships with service suppliers. Further, the paper discusses how the application of information technology may impact manufacturer-supplier relationships and performance. KEYWORDS: Information technologysimultaneitygovernanceSupply Chain Management (SCM)Transaction Cost Analysis (TCA)
Purpose In the competitive retailing environment, retailers who provide service experiences that stand out from the competition can gain a competitive advantage. Increasingly, an important aspect of the service experience involves product returns, in particular, the fairness of returns policies and procedures. Previous research studies support that interpersonal justice and informational justice relate positively to consumer attitudes and behaviors. In this paper, the authors examine the relative effects of interpersonal justice and informational justice on return satisfaction, positive word-of-mouth (PWOM) and trust. Additionally, the authors examine the moderating effects of returns process convenience and returns policy restrictiveness as indicators of procedural justice. Design/methodology/approach A scenario-based experiment methodology was used to test the relationships of interest. Findings Results support that the effects of interpersonal justice on the outcome variables are stronger than the effects of informational justice. There is also support for a moderating effect of returns process convenience on the relationships between interpersonal justice and each outcome variable, as well as partial support for the moderating effect of returns policy restrictiveness on the relationship between interpersonal justice and PWOM. Originality/value The research extends previous work on the effects of justice on customer outcomes. Results support the importance of retailers treating customers with fairness during the returns experience and further support the benefits of providing a convenient returns experience.
Purpose The purpose of this paper is to propose using agency theory for assessing the likelihood of quality fade in buyer‐supplier relationships and prescribing contractual mechanisms for reducing quality fade. In this paper, quality fade, an element of supply chain vulnerability, is defined as the unforeseen deterioration of agreed to or expected quality levels with respect to product and/or service requirements. The use of outcome‐based, behavior‐based, or mix contracts can be used to reduce the likelihood of quality fade and illustrate preferred scenarios for buyer and suppliers. Design/methodology/approach This paper proposes a conceptual model for using agency theory to explain and address a type of supply chain vulnerability called quality fade. A 2×2 matrix is proposed that contrasts outcome measurability with outcome uncertainty to illustrate buyer and supplier vulnerability and to suggest contractual mechanisms that can be used to mitigate vulnerability for both parties. Findings A typology of governance mechanisms is presented and described with the use of a manufacturer third‐party logistics provider example to illustrate the theoretical framework. Four different scenarios are discussed and described. Contractual mechanisms are provided to mitigate vulnerabilities and reduce quality fade. Originality/value Quality fade is a term that has not been described extensively in academic literature but is a term that is relevant in the broader discussion of supply chain vulnerability. Given that quality fade is a behavioral, as opposed to process oriented, approach, it requires a theoretical framework rooted in behavioral considerations. Agency theory is an appropriate framework for studying governance options.
Purpose This paper compares firms purchasing and/or selling food products internationally to those with domestic supply chains in order to determine if international firms: place greater managerial importance on security; and are more likely to engage supply chain partners in security‐related verification and information exchange. The purpose of this paper is to explore the link between security initiatives and firm performance in terms of security outcomes, product quality, and customer service. Design/methodology/approach A series of one‐way ANOVA tests are used to assess the differences between firms with international and domestic supply chains. Additionally, cluster analysis is conducted to group firms based on their performance levels. Findings Initial results indicate respondents with international supply chains perceive that their firms place more importance on security and are more likely to assess the security procedures of supply chain partners. Results further indicate that, in general, respondents in international firms perceive better security performance is achieved in terms of the ability to detect and recover from security incidents. Once firms are grouped by performance, respondents in the high‐performance cluster, represented predominantly by international firms, perceived significantly higher performance in the areas examined. Originality/value This paper is the first to compare, the differences in security measures employed by firms maintaining internationally oriented as opposed to domestically oriented supply chains and also relates the implementation of supply chain security measures to security and firm performance.
