Abstract

<em>This research aims to find out the most competitive retail company operating in current global market based on the perspective of efficiency. A well-performed company is the company that is efficient in its operations. By using Data Envelopment Analysis (DEA) approach, this research differs from prior research because we used multivariable inputs, namely: asset, operational expense and the number of employees. The output variables used in this research are: total revenue, net profit, return on equity (ROE), return on assets (ROA), return on investment (ROI), dividend yield ratio and asset turnover ratio. The analysis results shows that six retail companies are “efficient” in its operation (efficiency score of 1.00), namely: Carrefour, Costco, Kroger Company, Home Depot Inc, JD.com Inc Adr and Alibaba Group Holdings Ltd ADR. Therefore, these companies are considered the most competitive in its operation strategy in the current global market, whereas there are four retail companies falls into category of “inefficient” (efficiency score < 1.00), namely: Walmart, Amazon.com Inc, Tesco PLC and Walgreens Boots Alliance Inc.</em>

Highlights

  • Retailing serves the selling of goods and services toward the consumers, both for household and personal consumption

  • Based on table 7 above, we obtained the information that from the top ten retail companies operating in the global market, there are six companies that are efficient in carrying out their operations, the companies are considered to be the most competitive company in the global market, They are: Carrefour, Costco, Kroger Company, Home Depot Inc., JD.com and Alibaba Group Holdings Ltd

  • We outline the Data Envelopment Analysis (DEA)'s suggestions for these inefficient retail companies to be more competitive in the global market environment, which can be seen from the composite value and sensitivity report

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Summary

Introduction

Retailing serves the selling of goods and services toward the consumers, both for household and personal consumption. There are various types of goods available in retail shops, including: food, clothes, electronics, drugs, books, and many others (Marketos & Theodoridis, 2006). Retail industry has a long process of supply chain, starting from supplier, importer, producer, distributor, wholesaler, and retailer. The retail store is at the very end of the supply chain. Based on its supply chain, retailer directly interact with the end-consumers. Advances in information technology have been applied in this sector, both for data management, supply chain, and in terms of marketing strategies. The consumers can enjoy a quick and quality services

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