ABSTRACT
Efficient consumer response (ECR) is a well-established practice in fashion retail supply chains. It refers to a quick responsive and consumer-driven system. In this chapter, we explore the ECR program in fashion retail supply chain systems. First, we build a formal analytical inventory model with Bayesian information updating. Second, we conduct profit analysis for the fashion retailer with respect to the benefit of using ECR. After that, we examine the all-win situation in which we consider the consumer, the retailer, the manufacturer and the whole fashion retail supply chain system. Finally, we explore the supply chain coordination challenge in the presence of the ECR program. Both analytical and numerical analyses are conducted. We reveal that: (i) the ECR program is beneficial to the fashion retailer; (ii) the consumer welfare coefficient plays a critical role in determining whether the ECR program is harmful or beneficial to consumer welfare, and the manufacturer; (iii) if the consumer welfare coefficient is sufficiently small, the ECR program creates the all-win situation which means the fashion retailer, the manufacturer, the consumer and the whole fashion retail supply chain all benefit; (iv) the markdown contract can be set to achieve supply chain coordination.
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