Cheesy Wheezy Essay Example for Free

inexpensive Wheezy EssayStarting as a small retail store in sunrise(prenominal) Glarus, Wisconsin, the Cheezy Wheezy firm had slowly grown into a chain of nine retail shops located in southern Wisconsin and northern Illinois. In recent years, nearly all its competitors had begun issuing catalogs, widely distri entirelyed in novel October, advertising gift packages of cheeses, jams, jellies, and other fancy food items. Henry Wilson, son of the firms founder, had persuade his father that Cheezy Wheezy should also issue a catalog. It was then March, and the last snows were melting. Henry Wilson had called his third stave meeting in as many weeks to discuss the catalog project. Present were Henry (whose title was frailness president) Susan Moore, the sales manager Jeff Bell, the inventory manager and Robert Walker, the traffic manager. Also present was Robert Caldwell, from a Milwaukee-based ad result that was handling many aspects of the catalog project. Moore and Caldwell ha d just finished describing the catalogs tentative design and the allotment of catalog pages to various growth lines.Caldwell then said, We argon to the point w present we must design the order shape, which give be stapled inside the center pages. It will be a single 8 1/2-by-11-inch sheet. The guest will remove it from the catalog, complete it, fold it into the envelope shape, lick the gummed lines, and mail it in. The order form will be on one side of the sheet. On the other will be the book of instructions for folding and Cheezy Wheezys mailing address in New Glarus the remainder of the space will be ads for some impulse items. Right now were thinking of a Santa Clausshaped common fig molded out of cheese. Enough of that, said Wilson, this group isnt here to discuss Santa dolls. Were here to design the order form.We may also choose to talk a little c sufferly sell terms. Susan? Responding to her cue, Moore said, Our biggest problem is how to handle the transportation an d shipping be. Weve studied all our competitors catalogs. Some absorb the cost into the products price, some charge by weight of the order, some charge by money nurse of order, and some ship COD. How important ar shipping be, Susan? asked Bell. Plenty, was her response. They run $2 to $3 for a 1- or 2-pound package. If you contend a pound of cheese that we sell in our retail stores for $2, here atomic number 18 our cost if it goes by catalog cost of goods, $1 order management, 50 cents overhead, including inventory carrying costs, 50 cents packaging for shipment, 50 cents and transportation costs to any point in the United States ranging between $1. 75 and $3. 20. If, however, were dealing with bigger shipments, the relative costs vary. Im non following you, said Wilson. Its the likes of this, responded Moore.The livelongsale cost of cheese to us is the resembling per pound, no matter how much is sold. Order-processing costs argon approximately the same for each order w ell be receiving by mail. Overhead and inventory carrying costs are always present but may be allocated in a variety of ways. Packaging costs are also about the same per order. They go up only a few cents as we move to larger cartons. Transportation costs are hard to describe because of their tapers. Right now our whole catalog project is bogged down with the problem of transportation cost tapers. Tapers? said Wilson, staveing to Walker. Youve never told me about tapers before. It sounds like some kind of animal. Thats tapir, t-a-p-i-r, said Walker. Were talking about tapers, t-a-p-e-r-s. Oh, said Wilson. What are they? When one ships small packages of cheese, said Walker, rates are based on two factors, the weight existence shipped and the distance. As weight or distance increases or boththe rates go up but not as quickly. This is called the tapering principle. To ship 2 pounds of cheese from New Glarus to St. Louis costs $2. 40 3 pounds cost $3. 30 5 pounds cost $4. 60 and s o on.One hundred poundsno, 50 pounds is a better example because some of the parcel services well be using wont take 100 pounds50 pounds would cost $21. Theres also a distance taper. The 2-pound shipment that costs $2. 40 to St. Louis is $3. 40 to Denver and $4. 15 to Los Angeles. Cant we use the average transportation costs? asked Bell. Thats what we do with inventory carrying costs. Wont work, said Caldwell. Youll be overpriced for small, short-distance shipments and will lose sales. For heavy long shipments, youll be underpriced and will make so many sales that you might presently go belly up. Wilson shuddered and inquired, Does that mean we charge by weight and by distance? Moore answered, Its not that easy. In the cheese business, people buy by the pound, but shipping weightswhich include packagingare actually more.A guest who orders 3 pounds of cheese is in fact receiving 3 pounds of cheese cocksure 6 ounces of packaging materials. I wish we could sell a pound of cheese that consisted of 14 ounces of cheese and 2 ounces of packing material, but that would be illegal at worst, and of questionable ethics, at best. We have the same problems with distance, added Walker. Were trying to sell in 50 states, but who knows how far they are from New Glarus? We could have tables and maps in the catalog, but they take up valuable selling space. Also, if it looks too complex, we may just turn off some potential customers before they complete their orders. Some of our clients have another problem, added Caldwell, and that is split orders. The customer will want 10 pounds of cheese, but it will be five 2-pound packages sent to five dissimilar locations. That has an impact on both packaging and transportation costs. So, what do we do? asked Wilson.