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dc.contributor.authorFerguson, Mark E.
dc.contributor.authorKetzenberg, Michael E.
dc.description.abstractWe explore the value of information (VOI) in the context of a retailer that provides a perishable product to consumers and receives replenishment from a single supplier. We assume a periodic review model with stochastic demand, lost sales, and order quantity restrictions. The product lifetime is fixed and deterministic once received by the retailer, although the age of replenished items provided by the supplier varies stochastically over time. Since the product is perishable, any unsold inventory remaining after the lifetime elapses must be discarded (outdated). Without the supplier explicitly informing the retailer of the product age, the age remains unknown until receipt. With information sharing, the retailer is informed of the product age prior to placing an order and hence can utilize this information in its decision–making. We formulate the retailer’s replenishment policies, with and without knowing the age of the product upon receipt, and measure the VOI as the marginal improvement in profit that the retailer achieves with information sharing, relative to the case when no information is shared. We establish the importance of information sharing and identify the conditions under which substantial benefits can be realized.en
dc.format.extent310706 bytes
dc.publisherGeorgia Institute of Technologyen
dc.subjectValue of informationen
dc.subjectInventory managementen
dc.subjectPerishable inventoryen
dc.subjectProduct freshnessen
dc.subjectGrocery industryen
dc.titleInformation Sharing to Improve Retail Product Freshness of Perishables (ed.3)en
dc.typeWorking Paperen

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  • Operations Management [40]
    Functional area of business primarily devoted to the creation, planning, and management of the resource capabilities used by a firm to create products or services.

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