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The effects of firm size and sales growth rate on inventory turnover performance in the U.Sretail sector

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Retail Supply Chain Management

Part of the book series: International Series in Operations Research & Management Science ((ISOR,volume 122))

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Notes

  1. 1.

    The data set consists of a large cross-section of US public listed retailers for the time-period 1985–2003. The data set is summarized in Section 3.

  2. 2.

    This section of Silver et al. (1998) focuses on estimation of demand uncertainty. It does not refer to this relationship as economies of scale.

  3. 3.

    A counter argument is that as a retailer increases in size, it might have better forecasting tools and thus, might be better able to get the right product to the right place (and therefore, increase turns). Retailers’ ability to forecast may even vary non-linearly in size: they may be really good at forecasting when they are very small (not listed publicly, and hence, omitted from our data set), have difficulty as they grow and until they have reached a size such that they have good systems in place and are incorporating sophisticated decision support tools. We incorporate such differences in systems in our model by using capital intensity as a control variable.

  4. 4.

    Relative size, Sales(i,t–1)/Sales(i,0), yields identical results in an intra-firm model.

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Acknowledgment

The authors are thankful to Professor Ananth Raman for many helpful comments on this manuscript. The questions of the effects of firm size and sales growth rate on inventory turnover were suggested to the first author by Professors Marshall Fisher and Ananth Raman. The authors are also thankful to seminar participants at Boston University, Cornell University, University of Michigan, and University of North Carolina for numerous suggestions that were helpful in this research.

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  1. Johnson Graduate School of Management, Cornell University, Sage Hall, Ithaca, NY 14853, USA

    Vishal Gaur

  2. Kenan-Flagler Business School, University of North Carolina at Chapel Hill, Chapel Hill, NC 27599, USA

    Saravanan Kesavan

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  1. Vishal Gaur
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  2. Saravanan Kesavan
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    Gaur, V., Kesavan, S. (2008). The effects of firm size and sales growth rate on inventory turnover performance in the U.Sretail sector. In: Agrawal, N., Smith, S. (eds) Retail Supply Chain Management. International Series in Operations Research & Management Science, vol 122. Springer, Boston, MA. https://doi.org/10.1007/978-0-387-78902-6_3

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