This article has been reviewed according to Science X's editorial process and policies. Editors have highlighted the following attributes while ensuring the content's credibility: In recent years, the principle behind the humble ice cream truck has been getting a high-tech makeover. Retailers are reinventing mobile stores—both people-piloted and self-driving—often selling perishable items such as baked goods or fresh meals.
BPM Analytics projects sales from retail on wheels will grow to $30 billion worldwide by 2030. Mobile retail is a middle ground between in-store shopping—where customers can see and touch products—and online retail, where someone else picks and delivers their orders. Going where customers are can boost revenue, says Junyu Cao, assistant professor of information, risk and operations management at the McCombs School of Business at The University of Texas at Austin.
"The profits of a mobile store can surpass stationary or brick-and-mortar locations because it has the ability to move and find fresh crowds," she says. But when should a store make a move? The longer it stays in one spot, the more customers it serves.
But demand drops quickly, because most people buy almost immediately. Meanwhile, if the products are perishable, they lose freshness over time. In new research, Cao offers a strategic approach for retailers to juggle these considerations and decide how to deploy their fleets.
With Zhuolun Dong, a McCombs doctoral student, and Wei Qi of Tsinghua University, Cao built a mathematical model that determines the optimal balance between perching—staying in one place to sell—and migrating—driving to a new location. The researchers modeled a system of nine vehicles operating 12.5 hours a day. Drawing on real-world data from Neolix, a Beijing-based company whose autonomous vehicles deliver meals to office park and industrial workers, they integrated three variables: They found four factors for maximizing revenue from stores on wheels: Time of day.
Early in the day, stores should move frequently. They should hit as many locations as possible to capture customers when goods are freshest. As the day goes on and products get staler, stores should stay longer at each stop so they can squeeze out remaining demand before relocating.
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