Challenges, Opportunities and Logistics Practices of Delivering to High Frequency Stores

  • Alexandra Anderluh (Contributor)
  • Elena Ivanova (Contributor)

Activity: Talk or presentationScience to science

Description

It is recognized by leading multinational manufacturers that a significant part of retail trade is realized not only in typical supermarket chains, but also in small independent stores, which are referred to as ‘High Frequency Stores’ (HFS). Such stores are usually stalls, kiosks, convenience or rural shops, usually family-owned and visited multiple times per day by their customers. The number of such stores is high due to typically low barriers of entry in this market – the required investment is low and in most countries there are no formal barriers to operate such a store. Many industry observers expected that HFS would lose their market share because of the competition of supermarket chains, but on the contrary, the traditional retail, represented by small independent stores, is still alive. While in developed countries the grocery and fast moving consumer goods (FMCG) retail market is dominated by super- and hypermarkets, in developing countries they still have smaller market share. It is estimated that there are about 20 million HFS worldwide, but only a small part of them have consumer packaged goods of the world leading brands in their assortment. This is identified by FMCG companies as an opportunity to increase their market share in this segment. In order to cooperate successfully with independent retailers, it is important for manufacturers to understand their specifics from an organizational, distribution and operational perspective. In order for international FMCG companies to expand their market share in the HFS segment, they need to adapt their business model to the specifics of this market. The objective of this work is to identify the current and future potential of the HFS market segment, what challenges suppliers face delivering to this segment and what are the main logistics concepts and best practices, which could be applied.
Period2 Jun 20164 Jun 2016
Event titleCERR
Event typeUnkonwn
Degree of RecognitionInternational

Austrian Classification of Fields of Science and Technology (ÖFOS)

  • 502017 Logistics
  • 101015 Operations research