scholarly journals Effective Pricing of Perishables for a More Sustainable Retail Food Market

2019 ◽  
Vol 11 (17) ◽  
pp. 4762
Author(s):  
Jaekwon Chung
Keyword(s):  
Dynamic Pricing ◽  
Food Industry ◽  
Consumer Demand ◽  
Optimal Pricing ◽  
Perishable Products ◽  
Expiration Date ◽  
Food Retailing ◽  
Food Retailers ◽  
Food Market ◽  
Retail Food

Developing effective ways to manage perishable foods is crucial for food retailers to survive in the highly competitive retail food industry. Due to the nature of perishability, it is necessary to find an effective selling strategy to reduce waste from unsold perishables. Prior studies have proposed using dynamic pricing to develop an optimal pricing structure that compensates the consumer for the loss of freshness as the expiration date approaches. However, these studies have not considered consumer demand that more consumers are likely to purchase units of perishable products with relatively more or fewer days before expiration. In addition, prior studies have not compared dynamic pricing to a “no discount” policy whereby a retailer only displays those perishables that have the fewest remaining days to expiration, keeping units with a longer time before expiration in a warehouse. The results of this study show the potential impacts of different pricing by considering these issues. This study provides new insights for retailers to manage perishable foods with small and large packages that improve the sustainability of food retailing.

Strategische Möglichkeiten einer dynamischen Preissetzung im Lebensmitteleinzelhandel

2018 ◽  
Vol 59 (2) ◽  
pp. 21-25
Author(s):  
Annett Wolf
Keyword(s):  
Dynamic Pricing ◽  
Search Behavior ◽  
Expert Survey ◽  
Professional Management ◽  
Food Retailers ◽  
Retail Food

Abstract Die Etablierung dynamischer Preise erfordert ein professionelles Management. Während die Praxis im deutschen Einzelhandel zumeist noch auf herkömmlichen Ansätzen wie z. B. der Cost-Plus-Methode verharrt, nutzt Amazon das Wissen über den Kunden und dessen Suchverhalten seit längerem erfolgreich für eine dynamische Preisgestaltung. Im folgenden Beitrag werden die Möglichkeiten des Dynamic Pricing konzeptionell aufgearbeitet und deren Übertragung auf den Lebensmitteleinzelhandel empirisch anhand einer Expertenbefragung überprüft. Establishing dynamic prices requires professional management. While Amazon has been using its knowledge of the customer and its search behavior for a dynamic pricing, the practice of pricing in the German retail remains mostly on conventional approaches. In the following article, the possibilities of dynamic pricing will be conceptually elaborated and their transfer to retail food retailers will be empirically examined by means of an expert survey. Keywords: preisoptimierung, online handel, expertentool, dynamic pricing, datenanalyse

scholarly journals Does Healthy Food Cost More in Poor Neighborhoods? An Analysis of Retail Food Cost and Spatial Competition

2012 ◽  
Vol 41 (1) ◽  
pp. 43-56 ◽  
Author(s):  
Patrick L. Hatzenbuehler ◽  
Jeffrey M. Gillespie ◽  
Carol E. O'Neil
Keyword(s):  
Low Income ◽  
Rural Areas ◽  
Food Industry ◽  
Baton Rouge ◽  
Spatial Organization ◽  
Spatial Competition ◽  
Healthy Food ◽  
Food Market ◽  
The Cost ◽  
Retail Food

The organization of the Baton Rouge, Louisiana, retail food industry was analyzed to determine whether spatial competition influenced the cost and availability of food items. Using a spatial competition gravity variable, the costs of two separate market baskets were analyzed in January 2009, and the factors influencing spatial competition were determined. Store type (chain or supercenter) was found to be the most significant determinant of food costs, validating findings of past studies. Although food was not found to be more expensive in low-income areas, results suggest that residents in low-income and rural areas have disincentives to purchase affordable, available healthy food due to the spatial organization of their local food market.

scholarly journals Determining Discounts For Perishable Inventory

2011 ◽  
Vol 6 (1) ◽  
Author(s):  
Tom Bramorski
Keyword(s):  
Dynamic Pricing ◽  
Grocery Store ◽  
Perishable Products ◽  
Expiration Date ◽  
Pricing Model ◽  
Perishable Inventory ◽  
Decision Variables

In this paper, we develop a model to help manage prices of perishable products in a grocery store. We consider inventory on hand and proximity to expiration date as key decision variables. We also discuss the strategic importance of minimizing inventory that must be disposed of at a cost after the product expires. We also develop simple applied rules and highlight the benefits of using a dynamic pricing model to companies selling perishable products.

PRICING PERISHABLE PRODUCTS WITH COMPOUND POISSON DEMANDS

2011 ◽  
Vol 25 (3) ◽  
pp. 289-306 ◽  
Author(s):  
Pengfei Guo ◽  
Zhaotong Lian ◽  
Yulan Wang
Keyword(s):  
Dynamic Pricing ◽  
Sample Path ◽  
Compound Poisson Process ◽  
Optimal Pricing ◽  
Stochastic Comparison ◽  
Perishable Products ◽  
Sample Path Analysis ◽  
Compound Poisson ◽  
Comparison Approach ◽  
Poisson Demands

We consider the dynamic pricing problem of perishable products in a system with a constant production rate. Potential demands arrive according to a compound Poisson process, and are price-sensitive. We carry out the sample path analysis of the inventory process and by using level-crossing method, we derive its stationary distribution given a pricing function. Based on the distribution, we express the average profit function. By a stochastic comparison approach, we characterize the pricing strategy given different customers willingness-to-pay functions. Finally, we provide an approximation algorithm to calculate the optimal pricing function.

scholarly journals Two-Period Dynamic versus Fixed-Ratio Pricing Policies under Duopoly Competition

2019 ◽  
Vol 2019 ◽  
pp. 1-11 ◽  
Author(s):  
Hao Li ◽  
Xi Yang ◽  
Yu Tu ◽  
Ting Peng
Keyword(s):  
Dynamic Pricing ◽  
Utility Maximization ◽  
Fixed Ratio ◽  
The Other ◽  
Optimal Pricing ◽  
Perishable Products ◽  
Pricing Policy ◽  
Pricing Policies ◽  
Current Price ◽  
Identical Product

This paper introduces a two-period, pricing policy under duopoly competition between two firms offering an identical product to consumers who are intertemporal utility maximization. Firms have equal inventories of faultlessly replaceable and perishable products. The firms adjust prices to maximize profits and determine optimal pricing policies, choosing from dynamic pricing, fixed-ratio pricing, and elastic pricing policies. According to a duopoly competition model, the consumer is limited to a single firm visit per period. The consumer decides to purchase the product at current price from a firm and remain in the market to purchase product from the other firm in the next period or exit the market. The results offer three main conclusions. First, elastic pricing is consistent with dynamic pricing. Second, the more consumers visit the firm in the first period, the more profits the firm will make. Third, we explore the effectiveness of different pricing policies. The results show that although dynamic pricing is a more complex policy than fixed-ratio pricing, it may lead to decreased equilibrium profits when the firms sharply discounts prices and consumer rationality is unlimited.

scholarly journals Competition and cooperation models for dynamic pricing of perishable products in a two-echelon supply chain

2020 ◽  
Author(s):  
Zhenkai Lou ◽  
Xuming Lou ◽  
Fujun Hou
Keyword(s):  
Supply Chain ◽  
Dynamic Pricing ◽  
Optimal Pricing ◽  
Perishable Products ◽  
Sales Price ◽  
Competition And Cooperation ◽  
Optimal Pricing Strategy ◽  
Cycle Lengths ◽  
Total Profit ◽  
Finite Time Horizon

This paper considers a two-level supply chain involving a supplier and a retailer. The retailer sells perishable products to consumers over a finite time horizon, and the demand is driven by a price-and-utility function. First, we study the noncooperative problem, which is formulated by a Stackelberg model. It is shown that the optimal pricing strategy of the retailer is to reduce a constant amount on the price at the beginning of each stage. Second, we examine the cooperative problem, in which the supplier and the retailer jointly price the product. Maximum selling cycle lengths of the two situations are obtained by analyzing the reasonability of the sales price. We demonstrate that the selling cycle length is extended by cooperation. Moreover, we show that they lower the sales price in the cooperative case so as to maximize the total profit. Meanwhile, an allocation method is provided based on the proportion.

scholarly journals Pricing Strategies of Logistics Distribution Services for Perishable Commodities

Algorithms ◽  
2018 ◽  
Vol 11 (11) ◽  
pp. 186
Author(s):  
Tao Li ◽  
Yan Chen ◽  
Taoying Li
Keyword(s):  
Dynamic Pricing ◽  
Consumer Satisfaction ◽  
Service Providers ◽  
Time Constraints ◽  
Optimal Pricing ◽  
Pricing Strategies ◽  
Pricing Model ◽  
Logistics Service ◽  
Distribution Services ◽  
Perishable Goods

The problem of pricing distribution services is challenging due to the loss in value of product during its distribution process. Four logistics service pricing strategies are constructed in this study, including fixed pricing model, fixed pricing model with time constraints, dynamic pricing model, and dynamic pricing model with time constraints in combination with factors, such as the distribution time, customer satisfaction, optimal pricing, etc. By analyzing the relationship between optimal pricing and key parameters (such as the value of the decay index, the satisfaction of consumers, dispatch time, and the storage cost of the commodity), it is found that the larger the value of the attenuation coefficient, the easier the perishable goods become spoilage, which leads to lower distribution prices and impacts consumer satisfaction. Moreover, the analysis of the average profit of the logistics service providers in these four pricing models shows that the average profit in the dynamic pricing model with time constraints is better. Finally, a numerical experiment is given to support the findings.

scholarly journals Retail Deli Slicer Inspection Practices: An EHS-Net Study

2018 ◽  
Vol 81 (5) ◽  
pp. 799-805 ◽  
Author(s):  
LAUREN E. LIPCSEI ◽  
LAURA G. BROWN ◽  
E. RICKAMER HOOVER ◽  
BRENDA V. FAW ◽  
NICOLE HEDEEN ◽  
...  
Keyword(s):  
Food Industry ◽  
The United States ◽  
Cross Contamination ◽  
Prevention Strategies ◽  
Assessment Data ◽  
Worker Training ◽  
The Third ◽  
Control And Prevention ◽  
Retail Food ◽  
The U.S

ABSTRACT The Centers for Disease Control and Prevention (CDC) estimates that 3,000 people die in the United States each year from foodborne illness, and Listeria monocytogenes causes the third highest number of deaths. Risk assessment data indicate that L. monocytogenes contamination of particularly delicatessen meats sliced at retail is a significant contributor to human listeriosis. Mechanical deli slicers are a major source of L. monocytogenes cross-contamination and growth. In an attempt to prevent pathogen cross-contamination and growth, the U.S. Food and Drug Administration (FDA) created guidance to promote good slicer cleaning and inspection practices. The CDC's Environmental Health Specialists Network conducted a study to learn more about retail deli practices concerning these prevention strategies. The present article includes data from this study on the frequency with which retail delis met the FDA recommendation that slicers should be inspected each time they are properly cleaned (defined as disassembling, cleaning, and sanitizing the slicer every 4 h). Data from food worker interviews in 197 randomly selected delis indicate that only 26.9% of workers (n = 53) cleaned and inspected their slicers at this frequency. Chain delis and delis that serve more than 300 customers on their busiest day were more likely to have properly cleaned and inspected slicers. Data also were collected on the frequency with which delis met the FDA Food Code provision that slicers should be undamaged. Data from observations of 685 slicers in 298 delis indicate that only 37.9% of delis (n = 113) had slicers that were undamaged. Chain delis and delis that provide worker training were more likely to have slicers with no damage. To improve slicer practices, food safety programs and the retail food industry may wish to focus on worker training and to focus interventions on independent and smaller delis, given that these delis were less likely to properly inspect their slicers and to have undamaged slicers.

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