Abstract

The retailing sector is an important part of the economy of both developed and developing countries. In the U.S. economy, retail businesses (excluding motor vehicles and spare parts) represented $3.6 trillion in sales in 2014, contributed 5.8% to GDP, carried $366 billion in inventory, and provided direct employment to 15.6 million workers. E-commerce sales have been steadily growing faster than sales in brick-and-mortar stores. They have increased as a fraction of total retail sales from less than 0.2% in 1998 to 6.44% in 2014. The U.S. Bureau of Labor Statistics predicts that employment in retail is projected to grow at 7% per year between 2012–2022. The inventory productivity of retailers has improved over time; aggregate inventory turnover increased from 5.15 in 1994 to 6.87 in 2014. (We compile these statistics using data from Bureau of Economic Analysis (2016), Bureau of Labor Statistics (2016), and U.S. Census Bureau (2016).)