Proposal for a strategic planning for the replacement of products in stores based on sales forecast

• Main Authors: Cassius Tadeu Scarpin, Maria Teresinha Arns Steiner
• Format: Article
• Language: English
• Published: Sociedade Brasileira de Pesquisa Operacional 2011-08-01
• Series: Pesquisa Operacional
• Subjects: product replacement; Artificial Radial Basis Neural Networks; out-of-stock; forecasting time series; level of logistics services
• Online Access: http://www.scielo.br/scielo.php?script=sci_arttext&pid=S0101-74382011000200008&lng=en&tlng=en

This paper presents a proposal for strategic planning for the replacement of products in stores of a supermarket network. A quantitative method for forecasting time series is used for this, the Artificial Radial Basis Neural Networks (RBFs), and also a qualitative method to interpret the forecasting results and establish limits for each product stock for each store in the network. The purpose with this strategic planning is to reduce the levels of out-of-stock products (lack of products on the shelves), as well as not to produce overstocking, in addition to increase the level of logistics service to customers. The results were highly satisfactory reducing the Distribution Center (DC) to shop out-of-stock levels, in average, from 12% to about 0.7% in hypermarkets and from 15% to about 1.7% in supermarkets, thereby generating numerous competitive advantages for the company. The use of RBFs for forecasting proved to be efficient when used in conjunction with the replacement strategy proposed in this work, making effective the operational processes.