Retail logistics special issue

Citation

Mena, C. and Bourlakis, M. (2016), "Retail logistics special issue", International Journal of Physical Distribution & Logistics Management, Vol. 46 No. 6/7. https://doi.org/10.1108/IJPDLM-03-2016-0098

Retail logistics special issue

Article Type: Guest editorial From: International Journal of Physical Distribution & Logistics Management, Volume 46, Issue 6/7.

The logistics function has always been central to retail firms' performance because it co-ordinates the product and information flows from suppliers and manufacturers to retailers and, finally, to consumers (Bourlakis, 1998). However, over the few years we have witnessed a major transformation in retail logistics, driven by changes in demand and stimulated by technologies such as e-commerce, mobile commerce, tracking and tracing, and data analytics. These changes have led to the development of multi-channel and omni-channel offerings (Rao et al., 2009), which are altering business models and forcing retailers and manufacturers to rethink the way they reach customers. Similarly, we have seen the rise of ethical customers who are putting pressure on retailers to improve their environmental and social credentials (Mena et al., 2011; Spence and Bourlakis, 2009).

Managing these challenges requires significant investments in warehousing, distribution and retail infrastructure. The development of fulfillment centers, dark stores, home delivery networks, new transport technologies and customer collection points are all responses to these changes. These developments are also creating new challenges such as the dramatic increase in customer returns and the associated cost and availability implications (Ettouzani et al., 2012).

The logistics and SCM research community has been active in helping retailer organizations understand these changes in the marketplace and their implications for retail logistics theory and practice. However, the dynamic nature of the phenomenon means that it is necessary to continuously investigate new developments and understand their impact on retail logistics. To this end, over the last two years, IJPDLM has published a number of papers that address various retailing issues. Topics include demand management in the grocery industry (Alftan et al., 2015), retail out-of-stocks (Ehrenthal et al., 2014), on shelf availability (Moussaoui et al., 2016), the use of data aggregation to mask the bullwhip effect (Jin et al., 2015), reverse logistics (Hazen et al., 2014; Morgan et al., 2016) and sustainability in e-commerce (Mangiaracina et al., 2015). This special issue further addresses the growing opportunities for research in the field of retail logistics.

In total, 27 papers were received for this special issue and seven have been selected for publication based on the rigor of the research methods and the relevance and value of the findings for both academic and practitioner communities. The chosen papers cover a wide range of subjects including omni-channel logistics, product returns, e-tailing, inventory management and the management of “unsaleable” products. These papers incorporate various research methodologies using empirical data to produce insightful findings in relation to challenges and opportunities in contemporary retail logistics.

In recent years, we have seen the emergence of the omni-channel phenomenon where consumers interact with various shopping channels (e.g. store, online, mobile, mail order, etc.) when searching and ordering products. Likewise, consumers have the ability to get products delivered to various locations (and return those products) as they wish. The above present major challenges for retailers, who need to align and coordinate their physical (store) and virtual channels. The emergence of omni-channel systems is presenting retailers with a fresh set of challenges to deal with – a pattern that is reflected on the first three papers in this special issue.

The first paper by Ishfaq, Defee, Gibson and Raja, entitled “Realignment of the Physical Distribution Process in Omni-channel Fulfillment” examines the dynamics of omni-channel logistics. The paper employs a multi-method approach to shed light on the above including fifty interviews with supply chain executives from major retailers, obtaining secondary data for various issues (e.g. online sales, store and distribution networks, etc.) and developing a quantitative classification-tree analysis to illustrate possible associations. The paper has generated numerous insights in relation to realignment effort and strategic operational requirements that retailers operating in an omni-channel environment must employ. A key finding is that retail stores are enjoying a larger role in the distribution process. In addition the study indicates that store- and distribution center-related inventories are now considered fully integrated in order to maximize the potential benefits of network synergies.

The second paper entitled “Retail Logistics in the Transition from Multi-Channel to Omni-Channel” by Hübner, Wollenburg and Holzapfel, focusses on the transition that many retailers are currently undergoing to move from separate multi-channels to integrated omni-channel systems. The research adopts an exploratory survey approach to investigate current trends in the German retail market. From a theoretical perspective this research contributes a model and a series of propositions that help us better understand the structure and dynamics of omni-channel systems and the different adoption paths that German retailers are following. The research also has practical value as it gives practitioners a framework for transitioning from multi-channel to omni-channel fulfillment.

The third paper entitled “Online Retail Returns Management: Integration within an Omni-channel Distribution Context” by Bernon, Cullen and Gorst, concentrates on the challenges associated with consumer returns in an omni-channel environment, and explores the returns management strategies being deployed by a group of retailers in the UK. The research uses a mixed methods approach combining qualitative and quantitative empirical data collected from 12 retailers and three specialist returns management companies, focussing on three product categories: clothing, electrical/technical and home. The research provides evidence of the effects of omni-channel processes on retailers' performance and outlines the challenges that the transition toward omni-channel systems entails, particularly in terms of network design and returns processes. For practitioners, this research offers insights into the dimensions of network design and process management that can be used to revise strategies for both online and retail-based returns, ultimately supporting continuous improvement efforts in this emergent field.

Continuing on the subject of product returns, we include a paper by Ahsan and Rahman, entitled “An Investigation into Critical Service Determinants of Customer to Business (C2B) type Product Returns in Retail Firms.” The authors investigate the customer-to-business returns process in the Australian retail sector to identify and prioritize the critical determinants for product returns services. The authors build on justice theory to develop a framework of product returns services consisting of three major service categories and 16 returns service determinants. The criticality of the determinants was assessed using the analytic hierarchy process approach and relying on interviews with retail operations managers of major retail firms. The research highlights the importance of two returns services dimensions: the way in which returns services are handled through interaction, and the outcome of service delivery. The study also reveals that the most critical service determinants of product returns are: communication support service for customer, money-back for any type of returns, customer support access, user-friendly interaction and product replacement. These findings can help managers in retail firms to design and deploy more efficient and effective returns service systems and strategies.

The complexities of instore logistics processes related to “unsaleable” products in grocery stores are explored by Holweg, Teller and Kotzab in the paper entitled “Unsaleable Grocery Products, their Residual Value and Instore Logistics.” The research follows an embedded case study approach focussing on 32 retail and wholesale stores, to investigate how employees handle the logistics processes involving unsaleable products, and also identifies the challenges and opportunities they face. The study indicates that the processes for returning, disposing, recycling and redistributing products are the four key processes involved in handling unsaleable products. The authors also show that improvements across these four processes can have benefits across the four dimensions of the triple bottom line. Economic benefits stem from reduced costs, environmental benefits are associated with improved resource utilization and reduced waste, and social benefits include charitable support for people in need.

The paper entitled “An exploration of logistics related customer service provision on Twitter: The case of e-tailers” by Bhattacharjya, Ellison and Tripathi analyses a key dimension of online retailing as it examines the social media-based customer service activities of e-retailers. There is a paucity of research on this topic, particularly in relation to retail logistics that is surprising considering the increasing use of social media platforms by individuals and companies. The empirical research investigates the use of Twitter by e-retailers and analyses 5,000 pre-delivery and post-delivery conversations (16,998 tweets). The numerous findings emanating from this study include the involvement of customers in these conversations despite the fact that the conversations were not related to any orders made. Logistics companies tend not to get involved during these conversations and, subsequently, only e-retailers tend to respond and address issues raised by customers. The research study has generated a few managerial implications too. For example, it becomes evident that more supply chain members need to get involved (e.g. e-retailers, manufacturers, logistics companies) to address customer enquiries. Managers should also be aware that the public nature of Twitter fosters continuous interactions between current and potential customers and it can be an excellent platform for developing various customer relationship management strategies.

The special issue concludes with a paper by Hancerliogullari, Sen and Agca, entitled “Demand Uncertainty and Inventory Turnover Performance: An Empirical Analysis of the US Retail Industry.” In this manuscript, the authors examine the impact of demand uncertainty on inventory. Demand uncertainty is the outcome of unstable demand and inaccurate forecasts and is a major reason for firms holding inventory. The paper focusses on the effect of demand uncertainty on inventory performance and financial data for publicly listed US retailers obtained between 1985 and 2009. A statistical time series forecasting model is employed to illustrate forecasts and demand uncertainty. The paper identifies a new key performance indicator in relation to demand uncertainty – inventory turnover ratio – that can be used to cross-examine and benchmark firm's operations vis-à-vis others. The research also shows that demand uncertainty has a major negative impact on inventory turnover rate albeit for only a few retail segments. The paper contributes to the extant literature on retailing performance by highlighting the impact of various financial measures on the inventory turnover performance indicator. Retail managers could find this study beneficial as they could consider the proposed performance indicators when measuring and cross-examining their operations against major competitors.

Finally, we would like to thank the Journal Editor (Professor Alex Ellinger) for his continuous guidance and support and to acknowledge the key input of the referees in this process. Considering the significant interest generated by this special issue, IJPDLM has launched a new special issue on “Omni Channels” guest edited by Saghiri, Bernon, Bourlakis and Wilding of Cranfield University, UK with papers to be submitted by September 2016. The inclusion of references to IJPDLM retailing papers published over the last two years is intended to complement this special issue on retail logistics and encourage submissions to the omni-channel special issue by familiarizing prospective authors with recent retail logistics studies published in IJPDLM.

References

Alftan, A., Kaipia, R., Loikkanen, L. and Spens, K. (2015), “Centralised grocery supply chain planning: improved exception management”, International Journal of Physical Distribution & Logistics Management, Vol. 45 No. 3, pp. 237-259

Bourlakis, M. (1998), “Transaction costs, internationalisation and logistics: the case of European food retailing”, International Journal of Logistics: Research and Applications, Vol. 1 No. 3, pp. 251-264

Ehrenthal, J.C., Gruen, T.W. and Hofstetter, J.S. (2014), “Value attenuation and retail out-of-stocks: a service-dominant logic perspective”, International Journal of Physical Distribution & Logistics Management, Vol. 44 Nos 1/2, pp. 39-57

Ettouzani, Y., Yates, N. and Mena, C. (2012), “Examining retail on shelf availability: promotional impact and a call for research”, International Journal of Physical Distribution & Logistics Management, Vol. 42 No. 3, pp. 213-243

Hazen, B., Huscroft, J., Hall, D.J., Weigel, F.K. and Hanna, J.B. (2014), “Reverse logistics information system success and the effect of motivation”, International Journal of Physical Distribution & Logistics Management, Vol. 44 No. 3, pp. 201-220

Jin, Y.H., Williams, B.D., Waller, M.A. and Hofer, A.R. (2015), “Masking the bullwhip effect in retail: the influence of data aggregation”, International Journal of Physical Distribution & Logistics Management, Vol. 45 No. 8, pp. 814-830

Mangiaracina, R., Marchet, G., Perotti, S. and Tumino, A. (2015), “A review of the environmental implications of B2C e-commerce: a logistics perspective”, International Journal of Physical Distribution & Logistics Management, Vol. 45 No. 6, pp. 565-591

Mena, C., Adenso-Diaz, B. and Yurt, O. (2011), “The causes of food waste in the supplier-retailer interface: evidences from the UK and Spain”, Resources, Conservation and Recycling, Vol. 55 No. 6, pp. 648-658

Morgan, T.R., Richey, R.G. and Autry, C. (2016), “Developing a reverse logistics competency: the influence of collaboration and information technology”, International Journal of Physical Distribution & Logistics Management, Vol. 46 No. 3

Moussaoui, I., Williams, B., Hofer, C., Aloysius, J. and Waller, M. (2016), “Drivers of retail on-shelf availiability: systematic review, critical assessment and reflections on the road ahead”, International Journal of Physical Distribution & Logistics Management, Vol. 46 No. 5

Rao, S., Goldsby, T.J. and Iyengar, D. (2009), “The marketing and logistics efficacy of online sales channels”, International Journal of Physical Distribution & Logistics Management, Vol. 39 No. 2, pp. 106-130

Spence, L. and Bourlakis, M. (2009), “The evolution from corporate social responsibility to supply chain responsibility: the case of Waitrose”, Supply Chain Management: An International Journal, Vol. 14 No. 4, pp. 291-302