A1171
Title: Reducing food waste in grocery retailing: Improved demand forecasting for specific challenges
Authors: Maya Natascha Vienken - Bielefeld University (Germany) [presenting]
David Winkelmann - Bielefeld University (Germany)
Roland Langrock - Bielefeld University (Germany)
Theresa Elbracht - Bielefeld University (Germany)
Abstract: A key challenge for grocery retailers is to effectively manage inventories for perishables. This requires precise forecasting of customer demand to ensure customer satisfaction through a reliable service level while minimising spoilage with its financial and environmental consequences. Despite the availability of various forecasting approaches in research and practice, the dynamic nature of grocery store operations complicates accurate predictions. For instance, retailers frequently apply price reductions to units nearing expiration. Fully including such demand at a reduced price into the forecast can lead to overestimating future demand due to an uplift effect. Conversely, stockouts result in censored demand data, further complicating accurate demand forecasting. These complexities are examined using data from a major European grocery retailer, aiming to enhance demand forecasting accuracy. The ultimate objective is to contribute to the reduction of food waste in the retail sector, a commitment that major retail companies have made in partnership with the German Federal Ministry.
