Lecture 7: Sustainability in Operations Management Research Drivers of product expiration in customer packaged goods retailing:

Question 1

What is the paper investigating?

Answer 1

Consumer packed goods (CPG) create waste (Unsaleables)

The cost of unsaleables consist of the procurements and manufacturing cost of the product, sales and delivery cost to place it in-store, reverse logistics (send back cost and disposal cost.

Unsalebles also incur an environmental cost

Question 2

What is the aim of the paper?

Answer 2

1. To study expiration with cost and waste implications for both manufacturers and retailers.
2. Focus on the root causes and investigation of ways to reduce expiration in the CPG industry
3. Identification of five potential drivers of product expiration
   - Case size, Supply chain ageing, manufacturer´s sales incentive, replenishment workload and minimum order rules.

Question 3

What are the findings?

Answer 3

• Expiration of products in retail stores are driven by: Case size, inventory ageing in the supply chain, minimum order rules, manufacturer incentive programs for the sales force, replenishment workload, and many control variables
• The case company can save a lot of money by implementing four initiatives involving case size, supply chain ageing, minimum order rules, and sales incentives. (NOT REPLENISHMENT WORKLOAD)