Assortment Planning Analysis

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Assortment planning is gaining increasing attention in the operation research community due to recent publications on substitution models. Assortment planning models consider the question of which and how many different products to offer [32]. Kok and Fisher [33] define retail assortment planning as the process used to find the optimal set of products to be carried and set the inventory levels of each products. In 2009, Yucel [34] made a model of an assortment and inventory problem under consumer-driven demand substitution. He concludes that neglecting consumer substitutions, excluding supplier selection or ignoring space limitations all have significant impact on the efficiency of retail assortment. The further focus of assortment planning…show more content…
In economics, two or more products are classified is by examining the relationship of the demand schedules. This relationship between demand schedules leads to classification of goods as either substitutes or complements. Substitution effect is an effect of product to replace another product in use or consumption as a result of changed conditions. Complementary effect is an effect of product with a positive cross elasticity of demand to another product. This means a product’s demand is increased when the demand of another product is…show more content…
These considerations lead to grocery shopping behavior and retailer manipulation. Better shelf display influences shopper behavior, since the majority of consumers decide on their final purchases in the store [31]. Consumer also exhibit a low level of involvement with their in store decision, and make choices very quickly after a minimal search [36]. In 2005, Bai [9] use a different name of showroom as facing room. Facing is a very important variable for shelf space allocation. The number of the facing of a stock-keeping unit is the quantity of an item that can be directly seen on the shelves or fixtures by the customers. The items placed behind other items cannot be seen directly and hence are not deemed as a facing. The number of facings has an important influence on customer purchases [9]. Products with a better exposure have a greater chance of being purchased by the customer. Another consideration is related with showroom or facing room is location. Bai [9] used term location to clearly the place of product on the

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