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Bacel Maddah

Bacel Maddah

Professor and the Inaugural Chairperson in the Industrial Engineering and Management Department at American University of Beirut

Bacel Maddah is a professor and the inaugural chairperson in the Industrial Engineering and Management Department at AUB. Bacel’s research interests are in retailing, supply chain management, logistics, and other problems involving decision making under uncertainty. His research is published in leading journals in the field of Operations Research. He is an Associate Editor for International Transactions in Operational Research. Bacel has practical experience as a senior analyst with United Airlines and Hannaford Bros. He provides consulting and training for the local and regional industry.

Professional

Track: Optimization

Store-Wide Space Planning Balancing Impulse and Convenience

We develop a store-wide shelf space planning framework that balances impulse buying and shopping convenience via a bi-objective nonlinear integer program, similar in structure to a quadratic assignment. The model parameters are estimated based on real data collected from a large supermarket in the Normandy region, France. We propose a linearization scheme and utilize it to exploit the efficient frontier of Pareto-optimal solutions via the Īµ-constraint method. Our results indicate that the supermarket management can significantly increase their revenue from impulse buying, while not burdening the customer with the inconvenience of extensive walking and search. In fact, we observe that many of our Pareto-optimal layouts perform better than the actual layout the retailer is currently using on both impulse and convenience. For example, one well-balanced layout increases impulse profit by 82% and decreases walking by 11% with respect to the current layout. A side contribution of our work is developing a framework for data collection and parameter estimation based on panel (e-receipts and customer survey) data, observations from store visits.