Retailing can be defined in two ways, either as a set of functions that adds value to products/services that are sold to end users (functional understanding of retailing) or as a specific institution within a marketing channel that executes retail functions (institutional understanding). The functional view explains retailing as an exchange activity in order to connect a point of production with a point of consumption. These exchange processes refer to (see Kotzab & Bjerre, 2005): • Marketing processes, including all activities that provide a customized set of products/services as demanded by customers/consumers (which is basically known as offering a customer-oriented assortment in terms of quality and quantity) • Logistics processes, including all activities that help to transfer this specific set of products/services to the markets (such as transportation, breaking bulk and inventory management) • Assisting processes, which refer to all activities that facilitate a purchase (such as credit function, promotion or advice function). The orchestration of these functions leads to various types of retail formats such as store-based retailers (e.g., hypermarkets or category killers), non-store-based retailers (e.g., mail-order retailing or electronic commerce) and hybrid retailers (e.g., home delivery services) (Coughlan et al., 2006). Retailing plays a vital role in today’s economy, but many retailing companies face economic pressure as they operate predominantly in mature and stagnant markets (e.g. Seth & Randall, 2001). In order to face these specific challenges, retailing companies adapt strategies that allow them to gain economies of scale by offering highly customized solutions to their customers (see Table 1). These strategies are built upon the latest developments in information technology (IT) and are therefore called IT-assisted retail management strategies. The following chapter presents an overview to contemporary IT-based retail business models and frameworks that show how IT has created a new mandate for retail management. IT is defined here as the hardware and software that collects, transmits, processes and circulates pictorial, vocal, textual and numerical data/information (e.g., Hansen & Neumann, 2005; Chaffey, 2004).
Inventory Management Strategies of Food Manufacturing Industries in a developing economy
