Quick response in manufacturer-retailer channels
Management Science - Special issue on frontier research in manufacturing and logistics
Optimizing Inventory Replenishment of Retail Fashion Products
Manufacturing & Service Operations Management
Strategic Technology Choice and Capacity Investment Under Demand Uncertainty
Management Science
The Strategic Perils of Delayed Differentiation
Management Science
Strategic Capacity Rationing to Induce Early Purchases
Management Science
Optimal Pricing of Seasonal Products in the Presence of Forward-Looking Consumers
Manufacturing & Service Operations Management
Consumer Returns Policies and Supply Chain Performance
Manufacturing & Service Operations Management
Inventory Management of a Fast-Fashion Retail Network
Operations Research
The Impact of Quick Response in Inventory-Based Competition
Manufacturing & Service Operations Management
Intertemporal Pricing and Consumer Stockpiling
Operations Research
Fast fashion sales forecasting with limited data and time
Decision Support Systems
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A fast fashion system combines quick response production capabilities with enhanced product design capabilities to both design “hot” products that capture the latest consumer trends and exploit minimal production lead times to match supply with uncertain demand. We develop a model of such a system and compare its performance to three alternative systems: quick-response-only systems, enhanced-design-only systems, and traditional systems (which lack both enhanced design and quick response capabilities). In particular, we focus on the impact of each of the four systems on “strategic” or forward-looking consumer purchasing behavior, i.e., the intentional delay in purchasing an item at the full price to obtain it during an end-of-season clearance. We find that enhanced design helps to mitigate strategic behavior by offering consumers a product they value more, making them less willing to risk waiting for a clearance sale and possibly experiencing a stockout. Quick response mitigates strategic behavior through a different mechanism: by better matching supply to demand, it reduces the chance of a clearance sale. Most importantly, we find that although it is possible for quick response and enhanced design to be either complements or substitutes, the complementarity effect tends to dominate. Hence, when both quick response and enhanced design are combined in a fast fashion system, the firm typically enjoys a greater incremental increase in profit than the sum of the increases resulting from employing either system in isolation. Furthermore, complementarity is strongest when customers are very strategic. We conclude that fast fashion systems can be of significant value, particularly when consumers exhibit strategic behavior. This paper was accepted by Yossi Aviv, operations management.