A Collaborative Assessment of Promotions Performance Using Financial KPIs

Abstract

Since 2016, organized retailers in Colombia have struggled against a new retail format: Hard-discount stores. This sales channel fulfills essential shopping basket products with consistent low prices. To be competitive and preserve their market position, organized retailers must improve their processes and their pricing decisions. Promotions and discounts have been considered as an effective alternative to compete. This study analyzes the impact of joint prices decisions over the individual and global financial key performance indicators when a collaborative strategy is adopted. Our case study comprises a supermarket chain Colombian retailer and a consumer packaged-goods manufacturer to analyze its supply chain performance. The analysis considers different product categories (food, personal care, and cosmetics) and country regions. The results highlight that benefits are unequally distributed along different echelons and supply chain performance is affected when pricing decisions are made independently.

Citation

Castillo, J.G., Castañeda Velásquez, A.M., Cárdenas Hurtado, A., Suárez Moreno, J.D. and Prato, D.F. (2020), "A Collaborative Assessment of Promotions Performance Using Financial KPIs", Yoshizaki, H.T.Y., Mejía Argueta, C. and Mattos, M.G. (Ed.) Supply Chain Management and Logistics in Emerging Markets, Emerald Publishing Limited, Leeds, pp. 61-87. https://doi.org/10.1108/978-1-83909-331-920201004