Option #2: Kamron’s Supply Inc.

 

Kamron’s Supply, Inc. provides cleaning supplies to the automobile detailing industry. The most popular product is an all-in-one detailing package with several types of cleaning agents, wax, towels, and supplies. Kamron’s purchases the all-in-one boxes wholesale by the crate. The cost of each crate (50 all-in-one boxes) is $1,950. 

Required information:

1. Determine the operating income of each of the five retail customers. Explain the
   results.
2. How does this data inform decisions on customer targeting, customer retention, and
   sales? As a general manager of Kamron’s, how would you evaluate the delivery service
   and sales force? 
3. What approach would you take going forward with Wildcat Motors and Greyhound
   Classic Cars?

Follow the instructions you see on the Data tab of the worksheet. Show all calculations within the cells of the Excel spreadsheet (accessed through Module 1 or by clicking “Next” at the bottom of this page). This means that you must use formulas and links so that your thought process can be examined.

Review the grading rubric to understand how you will be graded on this assignment. Reach out to your instructor if you have questions about the assignment.

Submit your downloaded and completed Excel file with your name added to the file name for grading by your instructor to the CT Assignment area in Module 1.

2

>Data

all-in-one boxes) is $

,9

. The list sale price of the all-in-one box is $

.

2

7

64 64 64 64 64

.20

$ 54.00

3 4 26 3 3

3 5

4 12

3 7

1 5

4 50 6 12

1 2 12 0 0

Sales calls

Customer appreciation days

																																																Kamron’s Supply, Inc. provides cleaning supplies to the automobile detailing industry. The most popular product is an all-in-one detailing package with several types of cleaning agents, wax, towels and supplies. Kamron’s purchases the all-in-one boxes wholesale by the crate. The cost of each crate (		5		0		1	50						6			4
	Customer
	Raven used cars		Bear’s Auto		Wildcat Motors		Greyhound Classic Cars		Colt Auto
All-in-one Detail Kits (in boxes)	1	7		26	7			12	417	257
List selling price
Actual selling price		$ 54.00	$ 5					3	$ 49.50	$ 53.50
Number of shipments
		Sales calls	36
Number of deliveries	22
Miles traveled per delivery	14
		Customer appreciation days
Cost drivers for each activity:
Activity	Cost-Driver Rate
	Deliveries	$3 per delivery mile traveled
	Product handling	$0.90 per box sold
	Packaging	$14 per shipment
$140 per sales call
$250 per day

Required 1

Customer
Raven used cars Bear’s Auto Wildcat Motors Greyhound Classic Cars Colt Auto
Packaging
Sales calls
Deliveries
Product handling
Customer appreciation days

Revenues at list prices

Discount

Revenues (at actual prices)

Cost of good sold

Gross margin

Customer level operating costs:

Total

Customer-level operating income

Explain the customer profitability data (what is this data telling us?). Be thorough and specific:

Requirement 2

What value is there to management in reporting both the list selling price and the actual selling price for each customer?

How does this insight relate to the performance evaluation of the sales department?

Requirement 3

What issues from the data should managers consider in deciding whether to make adjustments or drop any of these customers?