The Bourbon Outfitter in Lexington, Kentucky sells souvenirs and paraphernalia r

Question

The Bourbon Outfitter in Lexington, Kentucky sells souvenirs and paraphernalia related to bourbon distilling and drinking. Its only physical retail outlet is a kiosk in a shopping mall; and its selling season is the Christmas shopping period. Its difficulty is that the mall will only rent kiosk space in three-month intervals—the kiosk is a fixed cost to The Outfitter, which has come up with the following solution: It rents the kiosk from November through January, and opens on November 1, sufficient time before Black Friday to make an impression on shoppers. It stays open until New Year’s and then closes down. Why?

Explanation / Answer

In this case the bourbon outfitter is trying to utilise their available space based on the business opportunities. The sales of their products souvenir and paraphernalia are mostly happening during the period of Christmas. Their only outlet is at kiosk point in a shopping mall. They rentou the kiosk point when they don't have much sales. Thus the company will get revenue out of it during their offseason from other companies and can utilise the kiosk for he sales during the peak season.it will stay until the new year time and those months are sufficient for them for the yearly sales target. This is known as capacity utilisation . The same technique usually use by farmers as during their offseason they will farm miscellaneous things inorder to utilise the facilities without wasting it.maximise the utilisation or facilities to their yield point.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.