How would you propose to manage the inventories

Assignment Help Operation Management

Reference no: EM132247399

House & Home (H&H) is a regional retailer of furniture, housewares, and decorative items. The company operates approximately 60 stores in the southeastern U.S. H&H was founded by Auburn graduate (Class of 1981) Dusty Smith in 1985 and has enjoyed consistent growth as measured by new store openings of 1-2 per year throughout its history. During a recent review of company finances, Dusty determined that the company was holding too much inventory.

Dusty has hired you as a consultant to help distinguish the top sellers from the “dogs”.

To that end, Dusty has provided you a random sample of 300 SKUs and their sales over the past 12 months. Additionally, each SKU is categorized as either a full-time stocking item that’s always in store (ST), a seasonal item that is available for sale for a two- month period (SN), or a holiday item that’s available for about 4 weeks in the November-December timeframe (HD). Dusty wants to be able to closely monitor his “strategic sellers” which constitute the 20% of ST items with the greatest sales (the A items). He wants to provide only minimal inventory management of the lowest selling 30% of items (the C items). He believes the remaining B items require a bit more attention than the C items.

Your assignment is to develop an ABC Analysis spreadsheet for the ST items using the template provided to you. We are going to assume that the profit margin on each item is the same, which will allow us to use COGS/year in descending order per SKU to rank the items. The A items will be those that make up the top 20% of this list, the B items will be the next 50%, and the C items will be the bottom 30%. Here are some key questions that you will need to answer after building the spreadsheet:

Question:

How would you propose to manage the inventories differently for the A, B, and C classes?

Reference no: EM132247399

Questions Cloud

Enterprise resource planning system implementation project : First City Bank Implements an ERP System First City bank initiated an Enterprise Resource Planning (ERP) system implementation project to reduce overhead,

Plagiarism is form of copyright infraction : Plagiarism is a form of copyright infraction. Explain what plagiarism is. Give some examples of plagiarism.

Discuss principle design objectives for service layouts : Discuss the role of human resources in today's business. Discuss principle design objectives for service layouts.

Primarily for the sale of goods or for services rendered : Was this contract primarily for the sale of goods or for services rendered?

How would you propose to manage the inventories : How would you propose to manage the inventories differently for the A, B, and C classes?

Salvage customers trust and promote further business : Create adjustment messages that salvage customers trust and promote further business? how we can represent it in presentation?

Gasoline station according to poisson process : Cars arrive at a gasoline station according to a Poisson process with an average of 10 customers per hour.

Estimate for annual holding cost per unit for supplier offer : Develop an estimate for the annual holding cost per unit for the supplier's offer.

Dealing with employee shortages and surpluses : What criteria would you suggest using for assessing the staffing alternatives related to dealing with employee shortages and surpluses??

User Account

All Pages