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Kudler Fine Foods Essay

1132 words - 5 pages

Running head: KUDLER FINE FOODSKudler Fine FoodsRobert BeardUniversity of PhoenixKudler Fine FoodsIn 1998, entrepreneur Kathy Kudler turned her passion for gourmet and specialty foods into a new business named Kudler Fine Foods. Beginning with a single store located in La Jolla, California, the business grew and prospered. Kudler opened a second store in Del Mar and a third in Encinitas. A fourth store is in the planning stage for Carlsbad. While the Encinitas store is prospering, the Del Mar location is providing less than expected results. Overall the business offers encouragement for future growth and success.Several problems exist for the business to which Kudler has inadequately ...view middle of the document...

Required will be a shifting of responsibilities to an individual or a team for inventory control and purchasing. Implementation may be effected by either reeducating existing employees, hiring professionals or introducing some form of a vendor managed supply system. (Fields, 2008) Because of the multiple locations of her business, she should embrace a team concept which to date has not occurred. "A team is a small number of people with complementary skills who are committed to a common purpose, set of performance goals, and approach for which they hold themselves mutually accountable." (Katzenbach, 1993) "The benefits of teamwork are getting the work done more efficiently and effectively, fostering innovation as well as helping to change." (West, 2004)Once Kudler has made this commitment, her challenge will be to educate her employees and herself for the upcoming change in operational management. The employees need to know and realize the importance of inventory costs and the relationship to the newly implemented system. They are currently involved with this activity and it should not be difficult for them to absorb what daily tasks correlate to the new system. Kudler's involvement and role in this education process will only be successful if she can convey her understanding of the benefits of accurate reporting and tracking of inventory.(Sari, 2008) "A standardized process is required to ensure that inventory reduction is accurately measured and information consistently reported throughout the organization." (Kumar, 2009)Kudler estimates that approximately 12% (Kudler, 2003) of her perishable goods represent shrinkage of her inventory and is removed from the shelves of her stores. Based on her reported cost of sales, this represents a loss to the organization of $835,000. Relating the gross profit margin to this amount, the lost profit attributable to this shrinkage is $375,000. Since only a fraction of this lost profit will be reclaimed from implementation of an inventory control system, whatever amount is reclaimed will represent an immediate financial goal and an amount to which any savings or improvement may be measured. Another consideration is the freeing of Kudler from a portion of her travel between stores for the purpose of operational management. Again, while this will likely not be eliminated, it will allow for considerable time for her to be spent in the marketing area which allowed her to achieve initial and continued...

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