Brian T. Ratchford
This chapter presents a review of issues associated with measuring productivity for different sectors of retailing, and reviews recent estimates of productivity changes in these sectors. In an attempt to explain the changes, the chapter reviews published evidence about the drivers of productivity changes in retailing, including scanning technology and other innovations in information technology. One finding is that these changes have created various types of scale economies that have led to the success of larger retailers, and have rendered smaller retailers less competitive. The emergence of Internet retailing and its impact on retail productivity is also discussed. In addition to understanding macro level changes in retail productivity, practitioners and others need to benchmark the performance of firms, sales territories, stores, departments and other entities against best practice. I review methods for accomplishing this, and discuss some published examples.