Product perishability and multistore grocery shopping

Abstract

Perishability, a largely unconsidered characteristic of consumer goods, is shown to play an important role in planned multistore shopping behavior. We present a model of consumers as cost minimizing inventory managers, who choose between two stores differentiated on location and price, and who purchase perishable and nonperishable goods. We show that the interaction between perishability of goods and price differences of stores can be an important driving force for planned multistore shopping. This rationale leads to a set of propositions. One unexpected result is that as the known price difference on a basket of identical goods increases between two stores, shoppers making store choice decisions on the basis of the basket price are more likely to shop regularly at both stores. We present survey results supporting our model’s predictions.