Store Performance Optimization

Consumer value can be created or enhanced through low cost product afferings at high service Ievels. This is one of the primary goals of all ECR (Efficient Consumer Response) initiatives around the world. In general, consumer needs are better satisfied when retailers offer the right mix of products, with a right price at the right time. Uncertainty in market demand and random consumer choice behavior have major influence on product availability and supply chain costs. Hence, each day, store managers have to cope with the problern of reducing dead weight shelf space due to safety stocks. In this thesis, Stefan Mohr approaches this category management problern by providing i) a forecasting tool for store sales accounting for both demand uncertainty as weil as random consumer choice behavior and ii) a product portfolio optimization tool for efficient assortment planning under risk that can be applied, for example, to new product introductions, SKU (stock keeping units) rationalization or category optimization at the brand, the product group, the category or even at the store Ievel.