Question

In: Operations Management

Given: The sales performance of the Luggage Department in a Sporting Goods Store last Fall was:...

Given:

The sales performance of the Luggage Department in a Sporting Goods Store last Fall was:

August                        $80,000,

September                   $90,000,

October                       $100,000,

November                   $140,000,

December                    $160,000, and

January                        $120,000

Total Seasonal Sales    $690,000

As the six-month merchandising plan for this department was being formulated for this fall season, the following decisions were made:

  1. An 8% sales increase could be attained this year due to the introduction and addition of a new classification of carry-on travel luggage that is well priced and of exceptional value.

  1. The planned BOM stock-to-sales ratio for each month this year would be the same as last year, i.e.

August               3.3,

September          3.1,

October              2.9,

November          2.5,

December           2.2,

January               2.6    with an ending retail inventory for the period of $288,000.

  1. The planned total reductions (markdowns) for last year were 11.6% and were distributed with 7% for August, 9% in September, 18% in October, 12% in November, 26% in December and 28% in January.

Compute:

  1. The planned monthly retail receipts (purchases) for each month.
  2. The planned average stock and the planned stock turnover.

Solutions

Expert Solution

keosha answered 1 day ago
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