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Figure 2 shows a bar gate stock graph which details the delivery of chicken portions to KFC's Exmouth restaurant during February 2018 - Edexcel - GCSE Business - Question 5 - 2020 - Paper 1
Question 5
Figure 2 shows a bar gate stock graph which details the delivery of chicken portions to KFC's Exmouth restaurant during February 2018. During this time it received t... show full transcript
Worked Solution & Example Answer:Figure 2 shows a bar gate stock graph which details the delivery of chicken portions to KFC's Exmouth restaurant during February 2018 - Edexcel - GCSE Business - Question 5 - 2020 - Paper 1
Step 1
Using the information in Figure 2, calculate the size of order A.
Answer
From Figure 2, it can be observed that order A was delivered when the stock level was at 1,300 portions. To confirm, we note that the buffer stock level is around 500 portions. Hence, the size of order A can be calculated as follows:
Size of order A = Starting stock - Remaining stock after order A
Thus, Size of order A = 1,300 - 500 = 800 portions.
Step 2
Using the information in Figure 2, calculate the number of days that KFC's Exmouth restaurant ran out of chicken.
Answer
The restaurant ran out of chicken on Day 26, where the stock level reached 0. From the graph, we see that it had a delivery on Day 22, thus:
KFC ran out of chicken on Day 26 - Day 22 = 4 days.
Step 3
Analyse the impact on KFC of poor supplier reliability.
Answer
Poor supplier reliability can significantly affect KFC's operations in various ways:
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Customer Satisfaction: KFC may experience outages during peak times, such as Saturday lunchtimes. This could lead to dissatisfied customers who may seek alternatives such as Burger King.
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Menu Restrictions: An unreliable supplier may force KFC to limit menu items, potentially omitting popular products like boneless boxes due to stock issues, which can impact sales.
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Revenue Impact: Reduced menu offerings and customer dissatisfaction can lead to decreased footfall and lower revenue. If customers find KFC items unavailable, they may turn to competitors, which could further reduce KFC's market share.
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Operational Challenges: KFC staff may struggle to manage customer expectations during stock shortages, leading to a chaotic service environment and possible staff burnout.
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Productivity Decline: With staff not operating at full capacity, the overall productivity of KFC could fall, affecting service speed and quality, which are vital for customer retention.
In summary, maintaining consistent supplier reliability is crucial for KFC to uphold its brand promise and ensure ongoing customer loyalty.