Optimal number of clerks to minimize store expected cost

Reference no: EM1397089

The Edge Convenience Store has approximately 300 customers shopping in its store between 9 am and 5pm on Saturdays. In deciding how many cash registers to keep open each Saturday, Edge's manager considers two factors: customer waiting time (and the associated waiting cost) and the service costs of employing additional checkout clerks. Checkout clerks are paid an average of $10 per hour. When only one is on duty, the waiting time per customer is about 10 minutes (or 1/6 hour); when two clerks are on duty, the average checkout time is 6 minutes per person; 4 minutes when 3 are working and 3 minutes when four clerks are on duty. Edge's management has conducted customer satisfaction surveys and has been able to estimate that the store suffers approximately $13 in lost sales and goodwill for every hour of customer waiting in line to checkout. Using the information provided, determine the optimal number of clerks to have on duty each Satyrday to minimize the store's total expected cost.

Reference no: EM1397089

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