Variation In Sales Research Articles

Unraveling the Impact of Pandemic: Investigating COVID-19 Effects on Seoul’s Alley Market Districts through Sales Variance and Urban Decline Assessment

Unraveling the Impact of Pandemic: Investigating COVID-19 Effects on Seoul’s Alley Market Districts through Sales Variance and Urban Decline Assessment

A Longitudinal Study of Sales-Based Investment and Leverage Decisions

The paper develops a system-based approach to investigate the dynamic adjustment of debt structure and investment policies in a context of risky sales. Empirical results were obtained through a panel data set of US DJ-IA firms/constituents index firms with different sectors. The analysis supports that environmental change does not affect equally the different industry since operating leverage differs among industries and so the sensitivity to sales variance. Including adjusted-specific variance, we find that there is no monotonic relation between leverage, sales and investment. The firm may choose a low debt level in response to high sales variance but high leverage to attenuate the negative relation between sales variance and current level of investment. We further find that while the overall effect of debt maturity on leverage is unaffected by the level of growth opportunities, the shorter the maturity of debt is the smaller the direct effect of sales variance on investment.

Sales variance analysis: how state-of-the-art analytical tools can contribute to increased profitability

Sales variance analysis: how state-of-the-art analytical tools can contribute to increased profitability

Smart advertising in prescription only medication; aligning it with prescriber’s or consumer’s behavior

PurposeThis study has four objectives. First is to investigate and compare the immediate and carryover effects of four pharmaceutical marketing tools (prescriber detailing, medical events, journal ads and direct-to-consumer advertising [DTCA]) on sales. Based on the effect comparisons, the second objective is to determine whether advertising tools that are more compatible with prescriber’s behavior have superior impact on sales. Third is to examine empirical support for the argument that advertising directly to consumers, as a market follower versus leader, has a backfiring effect. Finally, this paper aims to assess the magnitude of variance in sales as a function of each advertising tool.Design/methodology/approachData on unit sales and spending (on DTCA, journal ads, events and detailing) ranging 84 months are obtained for six prescription-only cholesterol-reducing brands. First, linearity is checked. Second, evolution versus stationarity is tested by applying the unit-root test. Third, potential endogeneity among variables is assessed with granger causality. Fourth, vector autoregressive model (VAR) that accounts for endogeneity and dynamic interactions is specified. Intercept, seasons and market share are added into the model specification as exogenous variables. Fifth, VAR with akaike selected lags and generalized impulse response are conducted. Finally, sales variance is decomposed with forecast error variance decomposition and Cholesky ordering.FindingsA 10% increase on detailing or journal ads spending brought an immediate (one month) negative effect on sales in a market leader, whereas that same increase is insignificant in a market follower. A 10% increase on DTCA (vs detailing) spending led to a negative (vs positive) carryover effect for the market follower, giving empirical support to the backfiring effect of DTCA and partial evidentiary support suggested about prescriber friendly advertising. However, DTCA induces a larger short term and longer carryover effect in a market leader, with seven times more effect on sales than what detailing does. In addition, it explains 50% of the variation in sales.Originality/valueThe model applied captures extensive dynamics; hence, findings are robust. The analysis considered comparison in terms of prescriber friendly (vs not) advertising tools and brand market status and thus can make managers rethink strategy of advertising budget allocations. This study also introduced a new look onto DTCA and hence challenges the traditional thought held on consumer advertising response.

Similar yet Different: A Comparative Study of Profitability Performance of Indian Retail Sector with a Special Reference to Big Bazaar and D Mart

Indian retail market has developed by means of one of the fastest-growing markets due to economic growth and the access of more than a few new players. Rising revenue as well as demand for quality products increases consumption expenditure. The existing research work goals to analyse the performance of the Indian retail segment and the aspects that make the Profit of Big Bazaar and D Mart, Different, despite their similar Sales revenue. Some variables such as Net Profit Margin, Inventory, Inventory turnover ratio, accounts receivables and Trade payables have been taken to study the profitability of the two selected players. It has been divulged that notwithstanding the insignificant variance in sales of Big Bazaar and D Mart, there has been a significant variance in Net Profit Margin, Inventory, Inventory Turnover ratio, Accounts Receivables and Trade Payables thereof. Though the sales of Big Bazaar and D Mart are marginally different, D Mart’s position and profitability performance have comparatively been seen healthier.

Growth Intention and Growth in Small Accounting Firms

Previous research has found that owner/manager growth intention is related to subsequent firm growth, but growth intention alone only explains about 4–5% of the variance in actual firm growth. The purpose of this study is to investigate factors in addition to growth intention that may help us to explain a higher proportion of the variance in firm growth. We selected three factors for our study: Entrepreneurial orientation, versatile human resources and labor productivity. We tested the hypotheses in a sample of small Norwegian accounting firms. The findings indicate that, after controlling for growth intention, versatile human resources and labor, productivity contributed to the explanation of the variance in sales and employment growth, while entrepreneurial orientation has no such additional effect.

Penganggaran dan Analisis Anggaran Penjualan

Anggaran Penjualan juga disebut sebagai anggaran utama dalam proses penganggaran, karena anggaran penjualan merupakan dasar penyusunan jenis anggaran lainnya. Tujuan penelitian ini adalah untuk mengetahui pendekatan penganggaran dan untuk menentukan penyebab dari varians antara anggaran penjualan dan penjualan aktual pada CV. Sumberjaya pada tahun 2016. Jenis penelitian ini menggunakan analisis kuantitatif dan kualitatif deskriptif. Studi ini menyimpulkan bahwa perusahaan menggunakan pendekatan top-down dalam proses penyusunan anggaran. Kemudian analisis varians penjualan menunjukkan bahwa varians kuantitas penjualan yang tidak menguntungkan terjadi di semua lima area penjualan. Setelah itu, perhitungan varians harga jual menunjukkan hanya satu area (Ubud) yang memiliki varian yang tidak menguntungkan dan kedua daerah (Kuta dan Mengwi) mencapai varian yang  menguntungkan.

Capital market imperfections and trade liberalization in general equilibrium

This paper develops a new international trade model with firm-specific credit frictions and endogenous borrowing costs in general equilibrium. We highlight new implications of globalization when general equilibrium effects on capital markets are present. In particular, we show that globalization increases the share of financially constrained firms and affects producers very differently depending on their exposure to credit frictions. While the positive effect of globalization dominates for unconstrained firms, higher borrowing costs and tougher competition especially hurt credit-rationed producers. We show that these new adjustments increase the heterogeneity among firms and reduce welfare gains from trade. Our theory is consistent with new empirical patterns from World Bank firm-level data. We show that credit frictions are positively related to the degree of product competition and to the variance of sales across firms.

Developing, validating, and testing a model of reflective leadership

PurposeThe purpose of this paper is to develop, validate, and test the impacts of reflective leadership (RL) on organizational performance.Design/methodology/approachThis is an empirical study based on over 700 survey responses from business leaders around the world. An instrument was developed to validate the model, and the statistical significance of its impacts on organizational performance was tested.FindingsThe findings show that a model of RL consisting of three leadership practices, creating an open and safe work environment, defining purpose, and challenging assumptions had significant impacts on organizational performance, accounted for 16.5 percent of the variance in the accomplishment of organizational goals; 13.9 percent of the variance in sales; and 14.7 percent of the variance in profits.Research limitations/implicationsThe major limitations are the biases that might be introduced with survey data. There are numerous implications for future research in terms of exploring additional RL practices, their impacts on additional and objective measures of performance, and in exploring the effects of moderating and mediating variables on the impacts of RL on performance.Practical implicationsThe results show that RL is an effective management tool practitioners can employ to improve organizational performance.Originality/valueA number of studies have broadly suggested that RL improves organizational performance, but this study empirically tests the impacts of a clearly defined, validated model of leadership on specific measures of performance.

Production Smoothing in Developed Countries

This paper extends the method of regressing production and sales variables on a set of seasonal dummy variables and a linear trend for empirical tests on the production smoothing hypothesis of inventory investment. Unit root testing procedures form the basis for constructing the bootstrap confidence intervals for the ratio of the variance of production to the variance of sales. Models used to test for a unit root when there are structural breaks in the linear time trend are converted to equations comprising deterministic and stochastic components. A limiting distribution of the test statistic is derived. Bootstrap resampling is conducted over deterministic parts of the converted equations to construct confidence intervals for the relative variance ratio for G7 countries. Primary findings for these countries are production-counter smoothing phenomena.

A study on the influence of eWOM using content analysis: how do comments on value for money, product sophistication and experiential feeling affect our choices?

ABSTRACTThe influence of electronic word of mouth (eWOM) has been heavily investigated in relation to online ratings. However, only a few studies examined the content of eWOM. From the perspective of the consideration sets model, consumers formulate an awareness set, a consideration set and a choice set before making a purchase. We argue that the formulation of these sets is influenced by eWOM based on its volume, valance and content relating to product attributes such as value for money, product sophistication and experiential feeling. In this study, the content of posts relating to Shure professional earphones in the online forum Mingo (www.mingo-hmw.com/forum) was captured and annotated. During the data collection period, Mingo was the sole online forum relating to professional earphones. Without much interference from other online forums, the circumstances of this study closely approximate a laboratory setting. In addition, we collected the actual sales, marketing costs, fault rates and number of retail stores selling the Shure professional earphones for 126 weeks. Our findings show that the weekly volume of posts, their relative number of positive (negative) comments, especially regarding value for money and sound quality, and those posts from the earlier week impinged strongly on weekly sales of Shure products. From the regression models, the explained variance in sales jumps from 0.236 to 0.732 due to the influence of eWOM.

IMPACT OF RETAILER COMPETITION ON MANUFACTURER'S DECISIONS AND PROFITS AT EQUILIBRIUM

As most of the supply chains in practice are decentralized, a key issue in supply chain management is to study the coordination of supply chain. The interactions among players are typically of two types, viz. vertical competition and horizontal competition. We use a game theoretic framework to analyze a two-stage supply chain. The supply chain is modeled as a Stackelberg game with a manufacturer as leader and multiple retailers as followers. We consider multiple retailers competing on quantities (Cournot competition) and study its impact on manufacturer's equilibrium decisions and profits. We show that the wholesale price contract does not achieve Nash equilibrium when retailers offer uniform pricing. On the other hand, in case of perfect price discrimination we prove the existence of unique Nash equilibrium in both deterministic and stochastic demand set-up. Under stochastic demand set-up, we consider information asymmetry between the manufacturer and retailers with respect to demand signal. Furthermore, we show the retailers' selling effort boost up the sales. As variance of sales can hurt the manufacturer's production decisions badly, we conjecture that the manufacturer can offer a retailer incentive contract which can manipulate retailers' equilibrium decision.

Threshold Incentives and Sales Variance

In this paper, we analyze the impact of two forms of commonly used threshold‐based incentive schemes on the observed sales variability. The first form of the incentive comprises an additional marginal payment on crossing a specified sales threshold and the second form of the incentive scheme comprises a lumpsum bonus payment on crossing the predetermined sales threshold. We model the effect of such incentives under two specific scenarios: an exclusive dealership selling a single product and a non‐exclusive dealer selling two competing products. For an exclusive dealer, we show that a bonus contract not only increases the expected sales, but, more importantly, decreases the sales (order) variance. Consequently, the bonus‐based scheme allows the manufacturer to regulate sales variance better. With a non‐exclusive dealer, the sales variance increases substantially with an additional marginal payment contract. However, our analysis suggests that the bonus contract continues to perform better in this case, too, if the threshold level is set appropriately using the underlying demand distribution.

Does Retail Advertising Work? Measuring the Effects of Advertising on Sales Via a Controlled Experiment on Yahoo!

We measure the causal effects of online advertising on sales, using a randomized experiment performed in cooperation between Yahoo! and a major retailer. After identifying over one million customers matched in the databases of the retailer and Yahoo!, we randomly assign them to treatment and control groups. We analyze individual-level data on ad exposure and weekly purchases at this retailer, both online and in stores. We find statistically and economically significant impacts of the advertising on sales. The treatment effect persists for weeks after the end of an advertising campaign, and the total effect on revenues is estimated to be more than seven times the retailer’s expenditure on advertising during the study. Additional results explore differences in the number of advertising impressions delivered to each individual, online and offline sales, and the effects of advertising on those who click the ads versus those who merely view them. Power calculations show that, due to the high variance of sales, our large number of observations brings us just to the frontier of being able to measure economically significant effects of advertising. We also demonstrate that without an experiment, using industry-standard methods based on endogenous crosssectional variation in advertising exposure, we would have obtained a wildly inaccurate estimate of advertising effectiveness.

Mind-Set Metrics in Market Response Models: An Integrative Approach

Demonstrations of marketing effectiveness currently proceed along two parallel tracks: Quantitative researchers model the direct sales effects of the marketing mix, and advertising and branding experts trace customer mind-set metrics (e.g., awareness, affect). The authors merge the two tracks and analyze the added explanatory value of including customer mind-set metrics in a sales response model that already accounts for short- and long-term effects of advertising, price, distribution, and promotion. Vector autoregressive modeling of the metrics for more than 60 brands of four consumer goods shows that advertising awareness, brand consideration, and brand liking account for almost one-third of explained sales variance. Competitive and own mind-set metrics make a similar contribution. Wear-in times reveal that mind-set metrics can be used as advance warning signals that allow enough time for managerial action before market performance itself is affected. Specific marketing actions affect specific mind-set metrics, with the strongest overall impact for distribution. The findings suggest that modelers should include mind-set metrics in sales response models and branding experts should include competition in their tracking research.

Threshold incentives over multiple periods and the sales hockey stick phenomenon

AbstractIn this article, we study threshold‐based sales‐force incentives and their impact on a dealer's optimal effort. A phenomenon, observed in practice, is that the dealer exerts a large effort toward the end of the incentive period to boost sales and reach the threshold to make additional profits. In the literature, the resulting last‐period sales spike is sometimes called the hockey stick phenomenon (HSP). In this article, we show that the manufacturer's choice of the incentive parameters and the underlying demand uncertainty affect the dealer's optimal effort choice. This results in the sales HSP over multiple time periods even when there is a cost associated with waiting. We then show that, by linking the threshold to a correlated market signal, the HSP can be regulated. We also characterize the variance of the total sales across all the periods and demonstrate conditions under the sales variance can be reduced. © 2010 Wiley Periodicals, Inc. Naval Research Logistics, 2010

Stabilized business cycles with increased output volatility at high frequencies

In Japan, like many other industrialized countries, output volatility declined dramatically in the 1980s. In order to investigate the cause of this decline, we decompose the variance of output growth by frequency. Our important findings are: (1) The total variance of output growth decreased, which resulted from a reduction in the volatility at business-cycle frequencies; (2) At business-cycle frequencies, the variance of production fell by a larger percentage than did the variance of sales; and (3) In stark contrast, at high frequencies, the variance of production increased, while the variance of sales decreased. These features of production at different frequencies cannot be explained by changes in the sales process and cost-shock process. Instead, improved business practices—such as the adoption of the just-in-time technique—played a direct role in stabilizing the business cycles, while increasing output volatility at high frequencies. J. Japanese Int. Economies 23 (1) (2009) 1–19.

Sales persistence and the reduction in GDP volatility

A number of explanations for the observed decline in GDP volatility since the mid-1980s have been offered. Valerie Ramey and Daniel Vine (2003a, 2003b) in a couple of recent papers offer the hypothesis that a decline in the persistence of sales is an explanation for the decline in GDP volatility [Ramey, V.A., Vine, D.J., 2003a. The Effects of Sales Persistence on Volatility in a Production Smoothing Model. Draft dated November 18; Ramey, V.A., Vine, D.J., 2003b. Tracking the source of the decline in GDP volatility: an analysis of the automobile industry. Unpublished Working Paper, presented on the ASSA program, San Diego, January 2004]. Their models show that a decrease in sales persistence leads to a decline in the variance of production relative to the variance of sales. They provide econometric evidence that the persistence of unit automobile sales has declined at both the aggregate and model level. This paper explores reasons why sales persistence may have declined and then tests the Ramey–Vine hypothesis with monthly chain-weighted sales data from 2- and 3-digit manufacturing and trade industries. The estimates confirm the Ramey–Vine findings for motor vehicle retailers, wholesalers, and manufacturers. For a number of industries outside of motor vehicles, especially those in wholesaling and nondurable manufacturing, considerable evidence is found of declines in sales persistence. These declines seem to be consistent with changes in supply and distribution chains that have occurred as the result of the introduction of new information, inventory, and production control systems. However, in equations estimated for aggregate manufacturing, wholesaling, and retail sector sales, declines in sales persistence are not found.

Bullwhip in a Spanish Shop

Sebastian de la Fuente is the sixth largest supermarket chain in the Basque region of Spain. It has a novel dataset of 108,605 observations on 3,745 SKUs, collected for almost 2 1/2 years. I find the bullwhip effect in the data: at least 80% of the SKUs have a bigger variance in supplies than variance in sales. I also test six potential causes of the bullwhip, and report clear evidence for three: a rational cause (batching by the supermarket) and two behavioral ones (under-reaction to lags and coordination risks).

Firm-Specific Determinants of Income Smoothing in Bangladesh: An Empirical Evaluation

The purpose of this chapter is to empirically examine the existence of income smoothing and determinants of smoothing behavior in Bangladesh. Using Eckel's (1981), Abacus (June), 28–40, “comparison of the variance of sales and profit” method, this study finds that a fair number of Bangladeshi firms engage in income smoothing. Particularly, 46 firms out of a sample of 107 firms with available data, engage in at least one type of income-smoothing behavior. Further, a logistic regression result indicates that firms characterized by sponsors having the largest ownership stake among all the equity holders and smaller firms engage more in income smoothing. Also, firms that have high debt to equity ratio engage more in smoothing behavior.