Exploring the retail industry environment using nonlinear analysis
International Journal of Retail & Distribution Management
ISSN: 0959-0552
Article publication date: 23 May 2019
Issue publication date: 24 May 2019
Abstract
Purpose
The purpose of this paper is to explore the dynamics of the relationships between sales and internal and external environmental drivers in a retail company using a systems perspective in order to support retail management decisions with nonlinear methods.
Design/methodology/approach
The research and results are presented in two parts: the collection and explorative analysis of the data; and discussion of the managerial implications following a systems perspective. The exploratory analysis is conducted using a statistical comparison of linear and nonlinear models of sales data from a retail company. The data, which comprise two data sets, come from 45 retail stores located in different regions of the USA.
Findings
Specifically, nonlinear models provided a better explanation of variation in retail activity (R2=46 per cent) than linear models (R2=16 per cent). In such a situation, the nonlinear analysis captures the influence of internal and external environmental drivers on retail sales.
Research limitations/implications
With a limited variety of external and internal drivers, the exploratory analysis aims to describe a general situation in which retailers are managing activities in complex environments as opposed to reflect on a particular retail chain.
Practical implications
The systems perspective is used to interpret the managerial implications of the nonlinear analysis fits, particularly in cases where retail decision-makers are adapting, transforming and restructuring sources of competitive advantage in complex environments.
Originality/value
The paper provides an alternative perspective (the systemic one) of how retailers could interpret the relationships between internal and external variables in the dynamic environment of the retail chains with nonlinear models.
Keywords
Citation
Moretta Tartaglione, A., Bruni, R. and Bozic, M. (2019), "Exploring the retail industry environment using nonlinear analysis", International Journal of Retail & Distribution Management, Vol. 47 No. 4, pp. 453-470. https://doi.org/10.1108/IJRDM-09-2017-0224
Publisher
:Emerald Publishing Limited
Copyright © 2019, Emerald Publishing Limited