An empirical analysis of evaluating the operational and economic efficiency of retail stores under an adverse operating environment

Abstract

This paper evaluates the relative efficiency of 83 food retail stores of a major Greek Supermarket network using monthly panel data that relates to an extended period of deep economic recession (2012–2013). We highlight the importance of the comparative analysis of operational and economic perspectives of the retail stores' efficiency, as they fully capture the real conditions in very competitive and dynamic recessionary environments given that retail stores are interested in minimizing costs while maximizing sales and profits. Efficiency measurements and comparisons led to the identification of benchmark stores and problematic ones thus leading to a series of management actions.