Our Research

Research Overview

Our research has a primary goal: to understand the complex micro-retailing ecosystem. We achieve this by conducting empirical research using primary data from various stakeholders (i.e. Suppliers, Micro-retailers and Consumers). Our approach involves conducting studies for each of these stakeholders to gain a deeper understanding of the challenges and opportunities within this sector.

Through these efforts, we contribute to the sustainable development of the region, a critical component of our mission to alleviate poverty. To enable large-scale initiatives, we collaborate with partner universities across Latin America. These collaborations involve the participation of thousands of students each year. These students undergo rigorous training and employ technology to ensure the reliability of data collected through immersive experiences, shadowing, and observation. This meticulous approach enhances the credibility of our findings

Ongoing Projects

LIFT Lab x Monterrey Tech

Our field study in Mexico in collaboration with Monterrey Tech allowed us acquire over 1.2 million records spanning over 13 campuses and 70 cities.

LIFT Lab x Tecmilenio

Our newest partner, Tecmilenio, has expanded our reach to Mexico’s most disadvantaged communities. This year, with 13 campuses onboard, we anticipate to receive over 1.5 million records.

Generative AI to support storekeeper’s decisions

By Fabio Castro, Josué C. Velázquez-Martínez and Sreedevi Rajagopalan

To investigate the impact of a conversational artificial intelligence (AI) assistant for micro-firms dealing with replenishment and sourcing decisions, we have developed a web-based behavioral lab experiment using the Prolific platform. Random subjects will be asked to act as managers and decide what to buy and stock up on in a micro grocery store (also known as a nanostore).

For the study, we have created treatment and control groups. The treatment group will receive an AI chatbot powered by large language models (i.e. GPT-3.5) trained to support their decision-making while the control group will be shown graphic dashboards to aid in their decision-making. We will track a range of performance metrics, including profits, chatbot usage, and time. We hypothesize that the treatment group (i.e. AI-chatbot) will show a significant increase in profits.

The effect of AI chatbots on the inventory decision making of micro-retailers: A field experiment in Mexico

By Fabio Castro, Josué C. Velázquez-Martínez and Sreedevi Rajagopalan

To investigate the impact of a conversational artificial intelligence (AI) assistant for micro-retailers dealing with replenishment and sourcing decisions, we have designed an experiment to be executed in the field. The experiment will be conducted with micro-retailers in the state of Mexico. The micro-retailers will be given a mobile application to input the daily sales, purchases, and prices of two products they identify as critical in maintaining stock availability. For the study, we have created treatment and control groups. The treatment group will receive an AI chatbot powered by large language models (i.e., GPT-3.5) trained to support their decision-making.

In contrast, the control group will be shown graphic dashboards to aid their decision-making. We will record the decisions taken and the usage of the chatbot to identify if access to the chatbot helps the micro-retailers in their ordering and stocking decisions. All participants will receive training in marketing and access to a tool where they can find the market price of products from large stores.

The impact of creating parking for freight vehicles on last-mile distribution for nanostores

By Camilo A. Mora–Quiñones, Josué C. Velázquez-Martínez, Jan C. Fransoo, Leopoldo Eduardo Cárdenas-Barrón

The lack of designated parking for freight vehicles in urban areas significantly disrupts goods distribution, leading to increased logistics costs, traffic congestion, and higher carbon emissions. This issue is particularly acute in developing cities, where the rapid growth of urban populations and freight transportation amplifies these challenges. Implementing loading and unloading zones (LUZs) has emerged as a promising solution to mitigate these impacts.

Our research included a field experiment conducted in Zapopan, Mexico, in 2021, to evaluate the impact of LUZs on environmental, economic, and operational outcomes. The findings revealed a 14% reduction in noise levels (dBA), a 3.55% decrease of CO2 in the air, a 10% reduction in logistics costs, and a 4% reduction in the carbon intensity factor. These results highlight the significant positive influence of LUZs on urban freight operations.

Our study demonstrates that dedicated LUZs can dramatically enhance the efficiency and sustainability of last-mile logistics. By reducing environmental impacts, easing congestion, and lowering costs for businesses, this scalable solution addresses the logistical challenges faced by growing urban centers in developing markets, offering a pathway to more sustainable urban freight systems.

We invite you to read the paper: https://www.sciencedirect.com/science/article/pii/S1361920924004437?via%3Dihub

Learn more about our studies and interests by downloading one of our papers or engaging with us using the contact form below.

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Supply Chain Management for Micro and Small Firms in Latin America

Supply Chain Management (SCM) primarily concentrates on large firms, neglecting micro and small enterprises (MSEs) in Latin America, which make up 99% of businesses. This chapter explores the relationship between MSEs’ productivity and SCM, highlighting research approaches, such as company size, surveys, and field interventions.

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The Coexistence of Nanostores within the Retail Landscape: A Spatial Statistical Study for Mexico City

The grocery retail landscape in Mexico city has changed over the past decade. This paper investigates the growth of convenience and modern channel stores, their impact on nanostores (mom-and-pop stores), and discusses the logistics and managerial implications for stakeholders.

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Adoption of Best Business and Supply Chain Practices and Micro/small Firms' Performance: Evidence from Northern Peru

Micro and small enterprises (MSEs) make up 99% of Peruvian firms, contribute 42% to the GDP, and employ half of the labor force. This study investigates how adopting Business and Supply Chain Management (SCM) practices affects MSEs’ performance.

Publications

Sonnenberg H. & Eustis E. (2023) Transforming Micro-Retailing in Emerging Markets. Master Of Applied Science In Supply Chain Management, Massachusetts Institute of Technology.
Fredericks, E, Pardo Rodriguez, M.P. (2022). The influence of manager-centric competencies on the performance of micro and small enterprises in Latin America. Master Of Applied Science In Supply Chain Management, Massachusetts Institute of Technology. https://dspace.mit.edu/handle/1721.1/142948
Mogollón Linares, M., Stimpson, B. (2021). The Impact of Trade Credits in Nanostore Distribution. Master thesis capstone project. MIT. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Mora-Quiñones, C. A., Cárdenas-Barrón, L. E., Velázquez-Martínez, J. C., & Gámez-Pérez, K. M. (2021). The Coexistence of Nanostores within the Retail Landscape: A Spatial Statistical Study for Mexico City. Sustainability, 13(19), 10615.
Illipronti, R.G. (2021). Improving survival of micro & small firms in Latin America during COVID-19 via SRM and CRM strategies. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Velázquez-Martínez, J. C., & Tayaksi, C. (2020). Supply Chain Management for Micro and Small Firms in Latin America. In Supply chain management and Logistics in emerging markets. Emerald Publishing Limited.
Thompson, T.N., Cabrera Hernández, A. (2020). Improving the Cash Availability of Small Firms in Latin America via Better Inventory Management. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Mora-Quiñones, C.A. (2020). The evolution of the grocery retail landscape in a megacity in emerging markets. The case of Mexico City. Master thesis. Tecnológico de Monterrey.
Chacra, F., Rocha, J. (2019). Behavioral Management Patterns: Small Firms’ Recipe for Growth. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Chin D., Hidalgo B., Silva B. (2019). The Impact of Leadership in Small Firms’ Supply Chains. Capstone project. GCLOG Capstone project. MIT Center for Transportation and Logistics. Request information
Su, Y.N. (2019). Gender Impact on Small Firms in Latin America. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Yoshizaki H.T.Y., Velázquez-Martínez, J.C., Mejia-Argueta, C. (2018). Supply Chain Management and Logistics in Latin America: A Multi-Country Perspective. Emerald Publishing.
Castañon Choque, X. (2018). The hidden impact of micro retailers’ survival rate on the logistics cost of consumer packaged goods companies. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Pereira Nunes, R., Paulino, R. (2018). The $100 question: Supply chain priorities for small firms. Master thesis. MIT Supply Chain Management program. MIT Center for Transportation and Logistics.
Tanco, M., Escuder, M., Heckmann, G., Jurburg, D., & Velazquez, J. (2018). The impact of Latin American research in Supply Chain Management: Challenges for the region. Supply Chain Management: an International Journal. Supply chain management in Latin America: current research and future directions. Supply Chain Management: An International Journal.
Velázquez-Martínez, J.C., Yoshizaki, H.T.Y., Mejia-Argueta, C. (2016). Introduction to Supply Chain Management and Logistics in Latin America.
Lambert, C., Salum, C., Romero, K., Builes, R., Castañon, X. (2016) What challenges are small firms in Latin America facing to survive? GCLOG Capstone project. MIT Center for Transportation and Logistics.