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Essay about Overhead Exercise

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THE BUSINESS SITUATION

Greetings Inc. has operated for many years as a nationally recognized retailer of greeting cards and small gift items. It has 1,500 stores throughout the United States located in high-traffic malls.

As the stock price of many other companies soared, Greetings' stock price remained flat. As a result of a heated 2007 shareholders' meeting, the president of Greetings, Robert Burns, came under pressure from shareholders to grow Greetings' stock value. As a consequence of this pressure, in 2008 Mr. Burns called for a formal analysis of the company's options with regard to business opportunities.

Location was the first issue considered in the analysis. Greetings stores are located in high-traffic malls where
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Wall Décor was designed to distribute unframed and framed print items to each Greetings store on a just-in-time (JIT) basis. The system works as follows: The Wall Décor website allows customers to choose from several hundred prints. The print can be purchased in various forms: unframed, framed with a metal frame and no matting, or framed with a wood frame and matting. When a customer purchases an unframed print, it is packaged and shipped the same day from Wall Décor. When a customer purchases a framed print, the print is framed at Wall Décor and shipped within 48 hours.

Each Greetings store has a computer linked to Wall Décor's Web server so Greetings customers can browse the many options to make a selection. Once a selection is made, the customer can complete the order immediately. Store employees are trained to help customers use the website and complete the purchase. The advantage to this approach is that each Greetings store, through the Wall Décor website, can offer a wide variety of prints, yet the individual Greetings stores do not have to hold any inventory of prints or framing materials. About the only cost to the individual store is the computer and high-speed line connection to Wall Décor. The advantage to the customer is the wide variety of unframed and framed print items that can be conveniently purchased and delivered to the home or
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