APPLICATION OF LEAN CONCEPT: THE CASE OF RETAIL COMPANY

Abstract

Retailing comprises an important portion of the economy both in Lithuania and EU in general, since it contributes significantly to the gross domestic product and labour creation. Globalisation and changing market demands are increasing competitiveness in retail, and as a result companies are adopting different improvement methods and techniques to assure their ability to compete in the market. Lean thinking is one of the wide-ranging ways to promote efficiency, while emphasizing a high level of awareness on customer. The paper aims to reveal the possibilities and barriers of Lean application in retail. In order to achieve this aim, the authors of the paper present the theoretical conceptual model which illustrates Lean implementation in retail. The research design applies a multi-method approach, combining systematic and comparative scientific literature analysis, and a semistructured interview. The results of empirical research revealed that retail company implements Lean concept aiming to reduce waste, to improve on-shelf availability, to optimize inventory management and space utilization, to increase customer service and satisfaction, and therefore to increase sales margins and profitability. The most successful Lean tools are 5S, Value stream map, Visual management, and Kanban. The primary barriers, impeding or slowing down Lean transformations most often are related to people: insufficient knowledge and engagement; the old ways of working and resistance to change; lack of effective leadership; inadequate communication. Therefore, training of employees, explanation of Lean benefits, creating an enabling culture, and motivating staff to provide suggestions for improvement could be the first steps to successful Lean implementation.