Both excess and shortage of goods bring numerous problems, tarnishing the customer experience and resulting in substantial losses for traders. When dealing with surplus stock, traders worldwide increasingly resort to selling merchandise on the secondary market, which involves specialized stores offering discounted discarded items. Such method appears to be rather inefficient and costly.
One significant drawback of the secondary market is that it only addresses overstock, not shortages. The potential impact of this solution lies in scenarios where retail chains frequently face situations where demand cannot be satisfied in specific stores, leading to customer loss, while other stores in the same chain have surplus inventory that remains unsold or is cleared at reduced prices. This creates an imbalance, resulting in significant economic challenges for traders.