The adoption of inventory postponement and speculation: An empirical assessment of oligopolistic Internet retailers

Joseph P. Bailey, Elliot Rabinovich

Research output: Contribution to journalArticlepeer-review

8 Scopus citations

Abstract

Unlike traditional retailers, which use inventory speculation for all their merchandise, Internet book retailers selectively use inventory postponement for specific merchandise items to lower their inventory costs. We develop and test hypotheses that describe merchandise determinants of inventory postponement and speculation at two oligopolistic retailers: Amazon.com and Barnesandnoble.com. We find that merchandise popularity raises both firms' likelihood of inventory speculation. Furthermore, merchandise vintage affects negatively both firms' likelihood of inventory speculation. Merchandise price affects negatively the likelihood of inventory speculation for Amazon.com and positively for Barnesandnoble.com. This may be due to conditions within Barnesandnoble.com, which operates physical and Internet channels.

Original languageEnglish (US)
Pages (from-to)258-271
Number of pages14
JournalTransportation Research Part E: Logistics and Transportation Review
Volume42
Issue number4
DOIs
StatePublished - Jul 2006

Keywords

  • Electronic commerce
  • Empirical study
  • Inventory management
  • Postponement analysis

ASJC Scopus subject areas

  • Business and International Management
  • Civil and Structural Engineering
  • Transportation

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