The effectiveness of automatic inventory replenishment in supply chain operations: Antecedents and outcomes

The issue of buyer-seller relationships in supply-chain management research is becoming increasingly critical. Global competition and maturing domesti c markets have driven supply-chain members to reassess their distribution t echniques to remain competitive in the market. Finns need inventory repleni shment systems that enhance customer service whereas at the same time reduc e inventory costs. Many retailers are demanding time-phased replenishment. They want delivery made just as they need the stock for sale. High levels o f anticipatory inventory are no longer acceptable. Retailers want high-volu me, high-rum items delivered on a just-in-time basis. In this study, we inv estigate the use of automatic replenishment programs (ARPs) and the effecti veness of these ARPs in today's markets. Through a survey of U.S. retailers and manufacturers, we examine the transaction specific, strategic, and org anizational antecedents that drive automatic replenishment efforts, as well as the effects of these efforts on the firms' strategic and economic perfo rmance.