A Heuristic Approach for a Shelf Space Allocation Problem

Hande Erol Bingüler, Serol Bulkan, Mustafa Ağaoğlu


A shelf space allocation problem (SSAP) is a special form of multi-constraint knapsack problem. The main difference between a knapsack problem and a SSAP is that a knapsack problem has only capacity constraints. Commercial space management systems use many different heuristic approaches for allocating shelf space due to the NP-hard complexity of the SSAP. These heuristics are usually based on simple intuitive rules that could be easily used in practice to implement shelf space allocation decisions. This paper develops a new heuristic to obtain a good allocation of shelf space for different products in order to increase profitability under different constraints such as limited shelf space and elasticity factors.

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