GOAL PROGRAMMING MODEL FOR GROCERY SHELF SPACE ALLOCATION PROBLEM

摘要

The U.S. grocery retail industry has annual sales of close to half a trillion dollars and is highly competitive. One important decision that affects both store profitability and customer service is how to allocate the shelf space to different products. A nonlinear integer goal program is proposed that considers both profitability and customer service factors in the objective function. This decision support tool highlights the tradeoffs made between profitability and customer service, and it helps the decision maker to determine the most desirable tradeoff level.