An Econometric Analysis in Retail Supply Chain Management: Sales Forecasting, Inventory Benchmarking and Supply Chain Optimization

The operational efficiency of a retailer is defined by its supply-chain management (SCM) mechanisms. When determining the efficiency of a retailer’s supply-chain management, the most commonly utilized metric is inventory turnover (IT). This econometric study systematically examines the relationship between SCM efficiency and IT rates by extracting inventory-based data for four global apparel retailers- Zara, Uniqlo, H&M, and Gap. The theoretical purpose of this study is to link quantitative analytics of top-grossing apparel retailers to operational conclusions

MEDIATION OF PROFITABILITY ON LIQUIDITY, ACTIVITY, AND LEVERAGE TOWARDS SHARIA SHARES RETURN

ABSTRACTThis research aims to gather empirical evidence on the position of profitability as a mediation variable on liquidity, activity, and leverage on stock returns in manufacturing companies listed on the Indonesian Sharia Stock Index (ISSI) between 2017 and 2019. A sample of 11 was collected using the purposive sampling method. A manufacturing firm registered as a consumer goods industry. According to the findings of this report, liquidity, activity, and leverage all significantly impacted profitability but had no impact on stock returns. Profitability has a significant impact on stock returns, and it is a variable that mediates the full impact of liquidity, activity, and leverage on stock returns.ABSTRAKPenelitian ini bertujuan untuk mendapatkan bukti empiris tentang peran profitabilitas sebagai variabel mediasi, terhadap likuiditas, aktivitas dan leverage pada return saham pada perusahaan manufaktur yang berada dalam Indeks Saham Syariah Indonesia (ISSI) selama tahun 2017 - 2019. Dengan menggunakan metode pruposive sampling diperoleh sampel 11 perusahaan manufaktur yang terdaftar sebagai industri barang konsumsi. Penelitian ini menemukan bahwa likuiditas, aktivitas dan leverage secara partial berpengaruh signifikan terhadap profitabilitas, tetapi berpengaruh tidak signifikan terhadap pengembalian saham. Profitabilitas berpengaruh signifikan terhadap pengembalian saham dan merupakan variabel yang memediasi penuh pengaruh  sebagai likuiditas, aktivitas dan leverage terhadap pengembalian saham

Influence of Crisis to Activity Indexes in Chosen Industrial Companies of the Country

Presently, the economic effectiveness of the company is becoming decisive alternative how to obtain competitiveness at the market. Reliable statement about financial situation can be obtained by analysis of the ability to pay the debts. Development in the industrial companies had been searched by indexes of activity, which express and quantify if the economy of the company is effective by the way of its assets. Results of the analysis show the most effective and less effective areas from the view of payment terms and assets turnover. Strengthening of the less effective areas can contribute to the whole economy of the regions and countries

Analysis of Retailer Inventory and Financial Performance

This paper attempts to recreate the regression model originally presented in Kesavan and Mani (2013) to analyze the relationship between abnormal inventory growth (AIG) and one-year-ahead earnings per share (EPS) for U.S. public retailers. In addition, this paper aims to build upon Kesavan and Mani (2013)’s findings by applying the model to recent data in order to test whether results vary as a function of different macroeconomic conditions. Unlike Kesavan and Mani (2013), I do not find a statistically significant relationship between AIG and future EPS for the years 2004-2009. However, when applying the same model to data from 2013 to 2018, I find a significant, inverted-U relationship between the two variables. These findings suggest that abnormal inventory growth is impacted by macroeconomic factors that encourage retailers to accumulate excess inventory. Furthermore, I find that excess inventories have a larger negative impact on future earnings than insufficient inventories, implying that retailers should prioritize strategies that prevent bloated inventory levels above those that lead to decreased service level

Manufacturing firms' reliance on past or future sales information in inventory production: an international study / Haihong He

This study examines whether manufacturing firm’s preference for use of past or future period sales information in determining inventory production is associated with two country level variables – management control system score and shareholder protection level. This study uses archival data to empirically examine the association between inventory production and sales information across twenty countries with different management control system score measured by Bloom et al. (2012) and different shareholder protection level measured by La Porta et al. (1997, 1998) and Djankov et al. (2008). This study finds that the entire sample experience a positive association between current period inventory production and future period sales change and no association between current period inventory production and past period sales change, suggesting that firms generally use future or projected sales change information instead of past sales change information in making production decisions. The study further shows that, after partitioning the sample based on country characteristics, the reliance on the future sales change information appears greater when firms are in countries with low management control system score or with high shareholder protection level. This study uses a large sample to gauge systematic differences in the use of management accounting information in inventory production across countries. The results suggest that less emphasis on management control (which may indicate greater emphasis on decision making) and high shareholder protection level have a positive effect on the firm’s preference of future information

An Exploration of ‘Sticky’ Inventory Management in the Manufacturing Industry

Traditional models examining relationships between firm resources and revenues assume that the many expenses and asset holdings change in proportion to changes in demand. However, research has found that for many costs and assets assumed to be variable, the magnitude of a change in a cost or asset in proportion to a change in revenue is smaller during periods when revenue decreases compared to the change in the cost or asset when revenue increases. Costs and assets which behave in this manner have been denoted as ‘sticky’ costs or assets. This study examines if inventory in the manufacturing industry is managed in a ‘sticky’ manner and what implications inventory stickiness has on firm performance. Utilising firm panel data over a 25-year time window we find that inventory stickiness does exist amongst manufacturers and that it has negative implications for firm performance

Impact of Credit Default Swaps on Firms’ Operational Efficiency

As one of the most important financial innovations in the last two decades, credit default swap (CDS) contracts have been initiated and actively traded in the market to hedge against credit risks. However, little is known about how these financial innovations affect an underlying firm’s operations. In this empirical study, we find that an underlying firm’s operational efficiency is significantly improved with the inception of CDS trading. Our results are robust to multiple causal identification strategies. Further analysis suggests that the inception of CDS tends to enhance the operational efficiency of a firm through the supply chain financing capability and trade credit. We also postulate that CDS leads to enhanced efficiency through institutional monitoring and improvements in management effectiveness. We then obtain suggestive evidence. Our findings have direct implications concerning the ongoing policy debate surrounding CDS. We contribute to operations management research by exploring how innovations in the financial market would, in turn, affect the operational performance of firms

Risky Suppliers or Risky Supply Chains? An Empirical Analysis of Sub-Tier Supply Network Structure on Firm Performance in the High-Tech Sector

Past research in supply chain risk management has focused on the interactions between buyers and their immediate suppliers and/or assumed independence of risks imposed by these suppliers. However, supply network structure may induce inter-dependency of risks due, for example, to overlapping sub-tier suppliers. This paper empirically studies the prevalence of overlapping sub-tier suppliers and their impact on financial performance for firms in the high-tech sector. Using firm-level supplier-customer relationship data, we find that on average 20 (2.3) percent of tier-2 suppliers are shared by at least two (five) tier-1 suppliers. We also find that the risk, measured as stock return volatility, of the focal tier-0 firm is positively associated with common tier-2 supplier risk, and the association is stronger for suppliers with a higher degree of tier-2 commonality. To disentangle the impact of risky supply network structure from risky tier-2 suppliers, we define two network metrics, viz., diamond ratio and cosine commonality score. We find that a one standard deviation increase in each of these metric leads to an increase in standard deviation of 0.58 and 0.41 respectively in tier-0 firm's risk. Our results reveal substantial unmanaged supply chain risks due to overlapping sub-tier suppliers, and highlight the need for firms to increase visibility into their extended supply network.http://deepblue.lib.umich.edu/bitstream/2027.42/116385/1/1297_Wang.pd

Two pawns in their game - Inventory and customer efficiency

This thesis examines efficiency in the retail industry in two different directions. In the first setting, the link between inventory efficiency and performance is examined in relation to firm characteristics and exogenous explanatory variables. More specifically, in addition to general firm-specific characteristics, the effects of chain affiliation and time trends within retail chains is examined. The effects of business environment factors on inventory turnover are examined on the basis of geographic location and market conditions. In the customer efficiency setting, efficiency is studied by observing customers’ in-store behaviours to identify how specific customer characteristics in general, and the use of in-store carrying equipment in particular, are associated with shopper efficiency. These two avenues for detecting important retail efficiency metrics are examined in three individual research papers. The papers empirically demonstrate two different perspectives on efficiency that are important for retailers to be aware of. From this customer and retailer perspective, several dilemmas exist that have been only partly covered in the three papers. This dissertation aims to discuss some of these dilemmas and to demonstrate some of the dualities that exist in the intricate interconnection between the customer and the retailer in the pursuit of efficiency. Overall, the thesis offers new insights, makes significant contributions to the literature and to retail practice in terms of the complex topic of retailer logistical performance and customer efficiency and develops a better understanding of some tenets of eminent and sustainable brick and mortar retailing