📘 Question
The COO shares that Goldcrest spends an average of $8,000 per store per month on raw ingredients. Waste and spoilage currently runs at 15% of ingredient spend. The operations team believes better inventory management could bring spoilage down to 5%. Assume 60 stores and 12 months in a year. How much annual savings does this represent, and what is the margin impact if Goldcrest's total annual revenue is $120M?
📊 Case Exhibit
Your answer:
The COO shares that Goldcrest spends an average of $8,000 per store per month on raw ingredients. Waste and spoilage currently runs at 15% of ingredient spend. The operations team believes better inventory management could bring spoilage down to 5%. Assume 60 stores and 12 months in a year. How much annual savings does this represent, and what is the margin impact if Goldcrest's total annual revenue is $120M?
