Companies such as Zara and World Co. have recently implemented novel product development processes supply chain architectures enabling them to make more design assortment decisions during the selling season, when actual demand information becomes available. How should retail firms modify their over time in order maximize overall profits for a given season? Focusing on stylized version of this problem, we study finite horizon multiarmed bandit model with several plays per stage Bayesian...

Working in collaboration with Spain-based retailer Zara, we address the problem of distributing, over time, a limited amount inventory across all stores fast-fashion retail network. Challenges specific to that environment include very short product life cycles, and store policies whereby an article is removed from display whenever one its key sizes stocks out. To solve this problem, first formulate analyze stochastic model predicting sales single during replenishment period as function...

Fast-fashion retailers such as Zara offer continuously changing assortments and use minimal in-season promotions. Their clearance pricing problem is thus challenging because it involves comparatively more different articles of unsold inventory with less historical price data points. Until 2007, used a manual informal decision-making process for determining markdowns. In collaboration their team, we since designed implemented an alternative relying on formal forecasting model feeding...

Carbon footprinting is a tool for firms to determine the total greenhouse gas (GHG) emissions associated with their supply chain or unit of final product service. typically aims identify where best invest in emission reduction efforts, and/or proportion that an individual firm accountable for, whether financially operationally. A major and underrecognized challenge determining appropriate allocation stems from high degree which GHG are result joint efforts by multiple firms. We introduce...

When suppliers (i.e., contract manufacturers) fail to comply with health and safety regulations, buyers (retailers) are compelled improve supplier compliance by conducting audits imposing penalties. As a benchmark, we first consider the independent audit-penalty mechanism in which conduct their respective impose penalties independently. We then examine implications of two new mechanisms that entail collective penalty. The is joint under jointly, share total audit cost incurred, penalty if...

Retailing consists of all the activities associated with selling goods to final consumer. In this article, we review research on retail operations published in Manufacturing & Service Operations Research (M&SOM) since 1999. We then discuss current landscape and new directions it offers, which M&SOM can play a prominent role.

Problem definition: We study the adherence to recommendations of a decision support system (DSS) for clearance markdowns at Zara, Spanish fast fashion retailer. Our focus is on behavioral drivers deviate from recommendation, and magnitude deviation when it occurs. Academic/practical relevance: A major obstacle in implementation prescriptive analytics users’ lack trust tool, which leads status quo bias. Understanding aspects managers’ usage these tools, as well specific biases that affect...

We propose an extension of the competitive newsvendor model to investigate impact quick response under competition. For this purpose, we consider two retailers that compete in terms inventory: customers face a stockout at their first-choice store will look for product other store. Consequently, total demand each retailer faces depends on competitor's inventory level. allow asymmetric reordering capabilities, and are particularly interested case when one firms has lower ordering cost but can...

Overcoming significant technical and human difficulties, Zara recently deployed a new process that relies extensively on sophisticated operations research models to determine each inventory shipment it sends from its two central warehouses 1,500 stores worldwide. By taking retail size-assortment view of store's inventory, the model incorporates link between stock levels demand select store replenishment quantities. Through rigorous, controlled field experiment, we estimate this has increased...

We present a methodology for long-term mine planning based on general capacitated multicommodity network flow formulation. It considers underground and open-pit ore deposits sharing multiple downstream processing plants over long horizon. The purpose of the model is to optimize several mines in an integrated fashion, but real size instances are hard solve due combinatorial nature problem. tackle this by solving relaxation tight linear formulation, we round resulting near-integer solution...

Consumers become satiated with a product when purchasing too much quickly. How is and how quickly depends on the characteristics of relative to time interval between consumption periods. Knowing that, consumers allocate their budget products that generate less satiation effects. Retailers should then choose sell induce minimal satiation, but usually this operationally more costly. To study trade-off, we provide an analytical model based utility theory relates customer price in context...

Motivated by retailers' frequent introduction of new items to refresh product lines and maintain their market shares, we present the assortment packing problem in which a firm must decide, advance, release date each given collection over selling season. Our formulation models trade-offs among profit margins, preference weights, limited life cycles. A key aspect is that short-lived sense that, once introduced, its attractiveness lasts only few periods vanishes time. The objective determine...

Unauthorized subcontracting—when suppliers outsource part of their production to a third party without the retailer’s consent—has been common practice in apparel industry and is often tied noncompliant working conditions. Because retailers are unaware party, process becomes obscure cannot be tracked. In this paper, we present an empirical study factors that can lead engage unauthorized subcontracting. We use data provided by global supply chain manager with more than 30,000 orders, which 36%...

Carbon footprinting is a tool for firms to determine the total greenhouse gas (GHG) emissions associated with their supply chain or unit of final product service. efforts typically aim identify where best invest in emission reduction efforts, and/or proportion that an individual firm accountable for, whether financially operationally. A major and under-recognized challenge determining appropriate allocation stems from high degree which GHG (or reductions) are result joint by multiple firms.

We present a framework to analyze the process location and product distribution problem with uncertain yields for large multinational food processing company. This consists of selecting processes, assignment products, production quantities markets in order minimize total expected costs. It differs from traditional facility due characteristics that are inherent industry sectors. These include significant economies scale at high volumes, switchover times, yield uncertainty. model as nonlinear...

Content providers manage their production by regulating the pace at which content is created and released. They have two types of consumers: existing ones, or followers; new visitors who may become followers. To maximize effectiveness, must consider direct, short-term effect also its indirect, long-term on retention expansion follower base. We develop a simple model to study dynamics building up base then combine that with stochastic dynamic programming optimize provider’s profit. find...