Managing Long Queues in Seasonal Sales Shopping
31 Pages Posted: 18 Dec 2013
Date Written: December 17, 2013
Long queues in seasonal sales shopping are seemingly undesirable for shoppers and retailers. Yet, this paper proposes that shoppers’ impatience can be a virtue for retailers. It shows that, when shoppers do queue, it is desirable under some conditions for retailers to strategically keep the queues longer rather than reducing them. This is due to two positive effects that shoppers’ queues have on retailers’ profitability: (1) to deliver seasonal promotions to low-time-cost shoppers who buy more when waiting longer in line; and (2) to turn away high-time-cost shoppers who choose to purchase at a regular time and pay the full price. Accounting for the two merits of long queues, this paper provides a numerical solution to optimizing retailers’ promotional and operational decisions related to seasonal promotions.
Keywords: Segmentation, queuing, promotion
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