IDEAS home Printed from https://ideas.repec.org/a/eee/joreco/v25y2015icp96-105.html
   My bibliography  Save this article

An empirical examination of performance in the clothing retailing industry: A case study

Author

Listed:
  • Manuel Xavier, José
  • Ferreira Moutinho, Victor
  • Carrizo Moreira, António

Abstract

This article estimates the efficiency of the 40 retail stores of a prestigious clothing company that operates in the Portuguese fast-fashion retailing market. The study compares the performance among the stores and provides insights into ways of improving performance in the retail clothing industry. A two-stage approach is used in this article. In a first stage, Data Envelopment Analysis (DEA) techniques are used to evaluate the performance of each store and to rank the stores. The input-oriented model was used to assess the summer and winter collections between 2010 and 2013. The results show that the total technical efficiency of the company decreases over time. Except for the year 2013, over 90% of the stores show increasing returns to scale during 88% of the period analyzed. The company faces a clear problem of productivity in its retailing operations. This deficiency seems to be intrinsic to the firm as it involves more than 60% of the stores. In a second stage, a quantile regression technique was used. This showed primarily that for the lowest quantiles of the efficiency score conditional distribution the coefficients on experience are very low, even close to zero, which suggests that the efforts taken by the stores in terms of experience are barely recognized by consumers in this fast-fashion retailing chain.

Suggested Citation

  • Manuel Xavier, José & Ferreira Moutinho, Victor & Carrizo Moreira, António, 2015. "An empirical examination of performance in the clothing retailing industry: A case study," Journal of Retailing and Consumer Services, Elsevier, vol. 25(C), pages 96-105.
  • Handle: RePEc:eee:joreco:v:25:y:2015:i:c:p:96-105
    DOI: 10.1016/j.jretconser.2015.04.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969698915000454
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.jretconser.2015.04.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Amado, Carla A.F. & Santos, Sérgio P. & Marques, Pedro M., 2012. "Integrating the Data Envelopment Analysis and the Balanced Scorecard approaches for enhanced performance assessment," Omega, Elsevier, vol. 40(3), pages 390-403.
    2. Siriopoulos, Costas & Tziogkidis, Panagiotis, 2010. "How do Greek banking institutions react after significant events?--A DEA approach," Omega, Elsevier, vol. 38(5), pages 294-308, October.
    3. Avkiran, Necmi K., 2011. "Association of DEA super-efficiency estimates with financial ratios: Investigating the case for Chinese banks," Omega, Elsevier, vol. 39(3), pages 323-334, June.
    4. Nooteboom, Bart, 1982. "A new theory of retailing costs," European Economic Review, Elsevier, vol. 17(2), pages 163-186.
    5. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    6. Sellers-Rubio, Ricardo & Más-Ruiz, Francisco J., 2009. "Efficiency vs. market power in retailing: Analysis of supermarket chains," Journal of Retailing and Consumer Services, Elsevier, vol. 16(1), pages 61-67.
    7. Brian T. Ratchford & James R. Brown, 1985. "A Study of Productivity Changes in Food Retailing," Marketing Science, INFORMS, vol. 4(4), pages 292-311.
    8. Amado, Carla A.F. & Santos, Sérgio P. & Sequeira, João F.C., 2013. "Using Data Envelopment Analysis to support the design of process improvement interventions in electricity distribution," European Journal of Operational Research, Elsevier, vol. 228(1), pages 226-235.
    9. Mahmut Yasar & Carl H. Nelson & Roderick Rejesus, 2006. "Productivity and Exporting Status of Manufacturing Firms: Evidence from Quantile Regressions," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(4), pages 675-694, December.
    10. Keh, Hean Tat & Chu, Singfat, 2003. "Retail productivity and scale economies at the firm level: a DEA approach," Omega, Elsevier, vol. 31(2), pages 75-82, April.
    11. Perrigot, Rozenn & Barros, Carlos Pestana, 2008. "Technical efficiency of French retailers," Journal of Retailing and Consumer Services, Elsevier, vol. 15(4), pages 296-305.
    12. Pekka Korhonen & Mikko Syrjänen, 2004. "Resource Allocation Based on Efficiency Analysis," Management Science, INFORMS, vol. 50(8), pages 1134-1144, August.
    13. S P Santos & C A F Amado & J R Rosado, 2011. "Formative evaluation of electricity distribution utilities using data envelopment analysis," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 62(7), pages 1298-1319, July.
    14. Herington, Carmel & Johnson, Lester W. & Scott, Don, 2009. "Firm-employee relationship strength--A conceptual model," Journal of Business Research, Elsevier, vol. 62(11), pages 1096-1107, November.
    15. A. Charnes & W. W. Cooper & E. Rhodes, 1981. "Evaluating Program and Managerial Efficiency: An Application of Data Envelopment Analysis to Program Follow Through," Management Science, INFORMS, vol. 27(6), pages 668-697, June.
    16. Dubelaar, Chris & Bhargava, Mukesh & Ferrarin, David, 2002. "Measuring retail productivity: what really matters?," Journal of Business Research, Elsevier, vol. 55(5), pages 417-426, May.
    17. Demirbag, Mehmet & Tatoglu, Ekrem & Glaister, Keith W. & Zaim, Selim, 2010. "Measuring strategic decision making efficiency in different country contexts: A comparison of British and Turkish firms," Omega, Elsevier, vol. 38(1-2), pages 95-104, February.
    18. Antreas D. Athanassopoulos, 2003. "Strategic Groups, Frontier Benchmarking and Performance Differences: Evidence from the UK Retail Grocery Industry," Journal of Management Studies, Wiley Blackwell, vol. 40(4), pages 921-953, June.
    19. Mohamed M. Mostafa, 2010. "Does efficiency matter?," International Journal of Productivity and Performance Management, Emerald Group Publishing Limited, vol. 59(3), pages 255-273, March.
    20. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    21. William W. Cooper & Lawrence M. Seiford & Kaoru Tone, 2007. "Data Envelopment Analysis," Springer Books, Springer, edition 0, number 978-0-387-45283-8, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lau, Patricia Yin Yin & Tong, Jane L.Y. Terpstra & Lien, Bella Ya-Hui & Hsu, Yen-Chen & Chong, Chooi Ling, 2017. "Ethical work climate, employee commitment and proactive customer service performance: Test of the mediating effects of organizational politics," Journal of Retailing and Consumer Services, Elsevier, vol. 35(C), pages 20-26.
    2. Nomita Pachar & Jyoti Dhingra Darbari & Kannan Govindan & P. C. Jha, 2022. "Sustainable performance measurement of Indian retail chain using two-stage network DEA," Annals of Operations Research, Springer, vol. 315(2), pages 1477-1515, August.
    3. Miguel Afonso Sellitto & Domingos Rafael Ferla Valladares & Erica Pastore & Arianna Alfieri, 2022. "Comparing Competitive Priorities of Slow Fashion and Fast Fashion Operations of Large Retailers in an Emerging Economy," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 23(1), pages 1-19, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, John S. & Lu, Louis Y.Y. & Lu, Wen-Min & Lin, Bruce J.Y., 2013. "Data envelopment analysis 1978–2010: A citation-based literature survey," Omega, Elsevier, vol. 41(1), pages 3-15.
    2. Liu, John S. & Lu, Louis Y.Y. & Lu, Wen-Min & Lin, Bruce J.Y., 2013. "A survey of DEA applications," Omega, Elsevier, vol. 41(5), pages 893-902.
    3. Kyungwan Ko & Meehyang Chang & Eun-Song Bae & Daecheol Kim, 2017. "Efficiency Analysis of Retail Chain Stores in Korea," Sustainability, MDPI, vol. 9(9), pages 1-14, September.
    4. Necmi Kemal Avkiran, 2017. "An illustration of multiple-stakeholder perspective using a survey across Australia, China and Japan," Annals of Operations Research, Springer, vol. 248(1), pages 93-121, January.
    5. Amado, Carla A.F. & Santos, Sérgio P. & Sequeira, João F.C., 2013. "Using Data Envelopment Analysis to support the design of process improvement interventions in electricity distribution," European Journal of Operational Research, Elsevier, vol. 228(1), pages 226-235.
    6. Gouveia, M.C. & Dias, L.C. & Antunes, C.H. & Boucinha, J. & Inácio, C.F., 2015. "Benchmarking of maintenance and outage repair in an electricity distribution company using the value-based DEA method," Omega, Elsevier, vol. 53(C), pages 104-114.
    7. Lau, Kwok Hung, 2013. "Measuring distribution efficiency of a retail network through data envelopment analysis," International Journal of Production Economics, Elsevier, vol. 146(2), pages 598-611.
    8. Yu, Wantao & Ramanathan, Ramakrishnan, 2009. "An assessment of operational efficiency of retail firms in China," Journal of Retailing and Consumer Services, Elsevier, vol. 16(2), pages 109-122.
    9. Cristina Suárez & Justo Jorge, 2010. "Efficiency convergence processes and effects of regulation in the nonspecialized retail sector in Spain," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 44(3), pages 573-597, June.
    10. Franz R. Hahn, 2007. "Determinants of Bank Efficiency in Europe. Assessing Bank Performance Across Markets," WIFO Studies, WIFO, number 31499, Juni.
    11. Tao Ding & Ya Chen & Huaqing Wu & Yuqi Wei, 2018. "Centralized fixed cost and resource allocation considering technology heterogeneity: a DEA approach," Annals of Operations Research, Springer, vol. 268(1), pages 497-511, September.
    12. Amy H. I. Lee & Chun Yu Lin & He-Yau Kang & Wen Hsin Lee, 2012. "An Integrated Performance Evaluation Model for the Photovoltaics Industry," Energies, MDPI, vol. 5(4), pages 1-21, April.
    13. Abolghasem, Sepideh & Gómez-Sarmiento, Juliana & Medaglia, Andrés L. & Sarmiento, Olga L. & González, Andrés D. & Díaz del Castillo, Adriana & Rozo-Casas, Juan F. & Jacoby, Enrique, 2018. "A DEA-centric decision support system for evaluating Ciclovía-Recreativa programs in the Americas," Socio-Economic Planning Sciences, Elsevier, vol. 61(C), pages 90-101.
    14. Mahlberg, Bernhard & Luptacik, Mikulas & Sahoo, Biresh K., 2011. "Examining the drivers of total factor productivity change with an illustrative example of 14 EU countries," Ecological Economics, Elsevier, vol. 72(C), pages 60-69.
    15. Liu, John S. & Lu, Wen-Min, 2010. "DEA and ranking with the network-based approach: a case of R&D performance," Omega, Elsevier, vol. 38(6), pages 453-464, December.
    16. K. Tone & M. Tsutsui, 2015. "How to Deal with Non-Convex Frontiers in Data Envelopment Analysis," Journal of Optimization Theory and Applications, Springer, vol. 166(3), pages 1002-1028, September.
    17. Paradi, Joseph C. & Rouatt, Stephen & Zhu, Haiyan, 2011. "Two-stage evaluation of bank branch efficiency using data envelopment analysis," Omega, Elsevier, vol. 39(1), pages 99-109, January.
    18. Perrigot, Rozenn & Barros, Carlos Pestana, 2008. "Technical efficiency of French retailers," Journal of Retailing and Consumer Services, Elsevier, vol. 15(4), pages 296-305.
    19. Elena Villar Rubio & Pedro Enrique Barrilao González & Juan Delgado Alaminos, 2017. "Relative efficiency within a tax administration: The effects of result improvement," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 9(1), pages 135-149, February.
    20. Dimitris Balios & Nikolaos Eriotis & Alexandra Fragoudaki & Dimitrios Giokas, 2015. "Economic efficiency of Greek retail SMEs in a period of high fluctuations in economic activity: a DEA approach," Applied Economics, Taylor & Francis Journals, vol. 47(33), pages 3577-3593, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joreco:v:25:y:2015:i:c:p:96-105. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-retailing-and-consumer-services .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.