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Functional Area Interrelationship Essay

1427 words - 6 pages

Kudler Fine Foods

Passionate about gourmet cooking and frustrated at having to travel all over town to gather the ingredients for one simple meal, Kathy Kudler decided to open her own gourmet food shop. Her vision was to create one store that would stock a wide selection of the freshest ingredients as well as all of the tools a gourmet cook could ever want. Kathy was certain that combining the convenience of one-stop shopping with reasonable prices would be a recipe for success.
Kathy's vision became a reality in 1998 with the opening of the La Jolla store. Her concept was an immediate success and in two years Kudler's expanded with the opening of the Del Mar location. Our latest store ...view middle of the document...

Through this arrangement, Kathy has managed to keep the company’s legal expenses to a minimum.
To date, Kudler’s has had only a few customer accidents that have ended in litigation. In each case, Anne suggested that Kathy agree to a settlement, telling her that, "going to court is like throwing dice."
Kudler’s uses very few custom forms, preferring instead to use forms (contracts, order forms, etc.) that are supplied by the parties the company is dealing with. For example, the leases on the stores were contracts supplied by the lessors. The few customized forms the company uses were obtained from "off-the-shelf" computer programs and slightly modified by Kathy or her assistant.

Supply Chain

There is no purchasing department in any of the stores although standard purchasing procedures are in place. Each of the three department managers in each store determines requirements for the items their department sells and places purchase orders directly with suppliers using a purchase order form that is standard between the three stores. It is the responsibility of the Department Managers to obtain the best price, quality, and delivery possible. They also receive and verify all orders in terms of whether they received the correct items and quantities and in undamaged conditions. Received items are documented on an Order Received form and sent to Accounting so that invoices for the items can be paid.
The three department managers are encouraged to check with their counterparts at the other stores on the pricing, quality, and delivery of the merchandise they order. They are also encouraged to combine orders between their stores if they feel there would be a cost savings resulting from ordering a larger quantity of a particular item or multiple items.
Kathy also places purchase orders. Kathy’s purchases relate mostly to unique, capital, or repair items that might be required by an individual store or for items used by all three stores, such as bulk Purchase Orders or Receiving forms.
Prepared purchase order forms are either mailed, handed to supplier salesmen, faxed to suppliers, or sent by E-mail if acceptable to suppliers. Whatever the method used, a purchase order form is always filled out initially and becomes the key tracking and financial document for an order.
Advertisements are prepared for local newspapers by Kathy. Advertised specials are offered at all three stores simultaneously. Kathy coordinates the items on sale with the store managers from each store during her weekly operations review meetings to make sure adequate supplies of merchandise will be on hand. Merchandise can be shifted between stores should one store have a higher demand of an item than another store, time permitting.
Accounting data is collected by the point-of-sale terminals (cash registers) that are used in each store at check-out to record all items, quantities, prices, taxes and totals for all daily sales transactions.

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