QUICK RESPONSE RETAILING IN CANADA AND THE NETHERLANDS

Abstract

Evidence of the quick response (QR) impact on retail inventory levels is presented. QR involves technology‐driven, co‐operative retailer/supplier relationships. QR enabling technology includes: point‐of‐sale systems, uniform product/article codes, and electronic data interchange. Using statistical analysis of Canadian chain store inventory data, and a case study on the largest chain store operation in The Netherlands, this study finds that QR is bringing lower inventory levels to retailers. There are two main retail management implications of these findings. First, merchandisers can use QR techniques to reduce inventory levels – but only up to a point. Since stock stimulates sales, retailers should use item/stock‐keeping unit (SKU) level data to study optimal (which may not equal minimum) inventory levels. Second, to reap the full rewards of QR implementation, retailers must share the SKU data with suppliers, and work towards more co‐operative relationships.