At the item level, forecasts have to be issued and ultimately purchase commitments have to be made. Problem: the large number of errors (either over stock or under stock) at the item level is disturbing to top management. Estimated costs of lost sales and backorders is about $11 million dollars, and liquidation costs associated with having too much of the wrong inventory is an additional $10 million totaling $21 million or 4% of catalog sales... displayed 300 characters
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The item forecast process involves a group of four to five individuals that include inventory buyers and product people and was typically accomplished by:
a. Rank various items in terms of expected dollar sales
b. Assign actual dollar values according to item ranking on excel spreadsheet
i. This could result in discussions, arguments, and complaints among the group members
c... displayed next 300 characters
At the item level, forecasts have to be issued and ultimately purchase commitments have to be made. Problem: the large number of errors (either over stock or under stock) at the item level is disturbing to top management...
Why, is this, a variable cost? It is a variable cost because it changes according to the level of cost-driver. The cost of the Item: Building Rent is a fixed cost that is not immediately affected by changes in the cost-driver level...
I can't say anything about the shipping time, since it never told me when our guests had purchased the items, but things always came packed neatly, and there was always a gift receipt with information about the item inside...
To enhance the ability of Kudler Foods to reliably and profitably create and deliver competitive advantage to the marketplace.
Spotlight operational capabilities that will generate profitability and build brand loyalty to Kudler Fine Foods
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