Too Much of a Good Thing: The Impact of Product Variety on Operations and Sales Performance

Philip Evers, and Martin Dresner. 2012. Too Much of a Good Thing? The Impact of Product Variety on Operations and Sales Performance

35 Pages Posted: 1 Jun 2016

See all articles by Xiang Wan

Xiang Wan

Ohio State University (OSU) - Department of Marketing and Logistics

Philip Evers

University of Maryland

Martin E. Dresner

University of Maryland

Date Written: May 30, 2016

Abstract

We examine the impact of product variety decisions on an operational measure – unit fill rate – and on sales performance. Results are estimated using weekly data over three years from 108 distribution centers of a major soft drink bottler. Our results show that fill rates are negatively associated with product variety at a diminishing rate. In addition, we examine the total effect of product variety on sales including both the direct effect and the indirect effect through operations performance. The total impact of product variety on sales initially is positive, although at a diminishing rate. However, beyond a certain level, increased product variety actually results in lower sales; that is, “too much of a good thing”. Thus, the findings provide a comprehensive understanding of the impact of product variety on operations and sales performance.

Keywords: Product variety; Fill rate; Sales; Distributors

Suggested Citation

Wan, Xiang and Evers, Philip and Dresner, Martin E., Too Much of a Good Thing: The Impact of Product Variety on Operations and Sales Performance (May 30, 2016). Philip Evers, and Martin Dresner. 2012. Too Much of a Good Thing? The Impact of Product Variety on Operations and Sales Performance. Available at SSRN: https://ssrn.com/abstract=2786753

Xiang Wan (Contact Author)

Ohio State University (OSU) - Department of Marketing and Logistics ( email )

Fisher Hall 524
2100 Neil Ave
Columbus, OH 43210
United States

Philip Evers

University of Maryland ( email )

College Park
College Park, MD 20742
United States

Martin E. Dresner

University of Maryland ( email )

College Park
College Park, MD 20742
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
98
Abstract Views
442
rank
287,317
PlumX Metrics