Business Analytics Seminar: Hamed Jalali, NEOMA Business School

Speaker: Hamed Jalali, NEOMA Business School (https://neoma-bs.fr/professeurs/jalali-hamed/)

Title: An efficient heuristic for large-scale dynamic assortment planning problem

Abstract: 

Single-period dynamic assortment planning refers to the retailer’s problem of deciding the set of products to offer and their initial inventory levels with stochastic demand and dynamic substitution. The goal of the retailer is to maximize its expected revenue subject to a capacity constraint on the total number of items offered. This problem is notoriously difficult to solve.

While existing heuristics are better suited to brick-and-mortar retailers with limited capacity, we introduce a novel heuristic designed to efficiently address the large-scale problems encountered by online retailers with high customer arrivals, a capacity of thousands of units, and extensive product variety. We impose no assumptions on preference lists and substitution patterns. Compared to the most recent heuristic, our algorithm is competitive in the average revenue obtained but it is significantly faster, especially for large instances. We show that our approach performs well in a variety of settings. We further validate our approach with a numerical example calibrated with real-world data from Wayfair, a major online home goods retailer

Host: Ata Jalili Marand

Organisers: Surabhi Verma and Hartanto Wong