Efficiency analysis of chain stores: a case study

Abstract

An efficiency analysis problem of a hairdressing company is addressed in this paper. The service system has the characteristics of different trade area types, multiple workers with different levels, crisp facilities and expenses and customer relationship orientations. A specialized imprecise data envelopment analysis (IDEA) model is proposed so that the efficiencies of stores from different trade areas can be compared and all workers in different ranks are included. The analysis results exhibit that the inefficiency in resource utilization is largely caused by inefficient operation. Based on the measurement results, eight stores and two stores are aimed with high priority for improving the efficiencies in operation and scale, respectively. The regional manager agrees that IDEA is helpful in evaluating relative efficiency and detecting the reasons caused inefficiency.

Keywords:

• data envelopment analysis
• assurance region
• efficiency decomposition

Acknowledgements

The author deeply appreciates the editors and anonymous referees whose comments and suggestions added significantly to the clarity of this paper. The author is also grateful to Miss Hsieh for the help in collecting and processing data of the case company.