Challenges of inventory management in crisis situations from the perspective of food retailers

Abstract

Our study focuses on food retailing and its inventory practices, which have been severely affected by the panic buying wave following the recent crisis situations which have occurred in Europe (e.g., military conflict near the boarders of the EU, energy crisis, or the epidemic). The aim of this paper is to present the management options for the inventory mechanisms of food products in a crisis situation - for retailers on the downstream side of the supply chain, who were the first to face the demand fluctuations caused by the crises of recent years - and to describe, through case studies, how to identify and manage inventory difficulties that arise. The objective of the study is to explore, through the examples of three food retailers under study, which of the management solutions available in the literature can be applied in practice. Our results show among other things that, although the literature suggests that the safety stock is one of the methods to reduce uncertainty, it has not been found to be an effective method in the current circumstances. Other findings reveal that the companies in the sample have a short-term approach to crisis management and they apply them to create specific scripts for the possible crisis. A key finding of the research is that it provides practitioners a summary of good practices to contribute to their crisis management interventions at a planning level.