KiddiLand and the Super Gym
Chapter 1 Case Study
1. The advantages of purchasing a two-wheeled trailer for each of the stores to use for delivering Super Gyms are none at the moment because the bumpers on the newest autos cannot accommodate the trailer hitches, therefore, the two-wheeled trailers could not be used. The disadvantages of purchasing of each trailers for each store is the enormous price of 1800.00 per trailer, 250.00 per store for adequate bumper hitches, and an additional 50.00 per year for licensing, and insurance, for an item that wouldn’t work to start with. To cover all 70 stores this is a total of 14,700.00 that would be spent, as well as each customer would have a delivery charge of 368.00 to have them delivered.
2. The advantages of having local trucking is a great price of 38.21, rounded to a flat charge of 40.00 per set within a 25 mile radius of the store, with an additional 1.50 per mile beyond 25 miles. With 85% of the customers living within that area, that would cover a good percentage of the customers at a reasonable price. Most delivery companies normally deliver twice a week and not daily, so that could be a customer service issue. Another disadvantage would be to have to make a decision by Monday , so advertisement would have time to include the delivery charge in the Spring-Summer brochure. IF the store absorbs the delivery price, it would have to be accounted for in the price of the set. But, that would be good customer service on the stores part. If the customer has to absorb the cost, it would be a disadvantage for the customer, but, most stores charge delivery charges, so as long as it is clearly stated on the advertising of the gym, then, they could make the decision if they could afford it or not.
3. Stocking the gym at the warehouse would take up a lot of space. A disadvantage would be delivering it by the large trucks. Another disadvantage is the customer never seemed to get the correct three boxes delivered, as the set requires. Trying to squeeze an 18-wheeler into the subdivisions. Every time they try, they knock down a couple of mailboxes and leave truck tracks in the homeowner’s lawn. The advantages of stocking the Supergym at distribution centers and let them deliver it to the customer is that Kiddieland doesn’t have to stock the products in their shops, which reduces the logistics and reduces costs of holding a stock
4. The advantage of charging the customers the 40.00 fee would be that most customers would gladly accept that as a reasonable delivery fee, if they do not have a vehicle that could carry that amount, sizes, and weight of the