Best Buy’s Holiday Sprint

Best Buy’s Holiday Sprint

December 20, 2017

Article Title: Best Buy’s Distribution Centers Work Around The Clock For Holiday Sprint: Best Buy’s Logistics Will Soon Be Tested By a Crush of Shoppers

Author of Article: Kavita Kumar

Date of article: November 21, 2017

Source URL: http://www.startribune.com/best-buy-s-distribution-centers-work-around-the-clock-for-holiday-sprint/459221513/#1

This article looks at preparations that Best Buy is making to handle the rush of Black Friday and Cyber Monday sales. Best Buy is anticipating a 15% increase in online sales for Thanksgiving Day. Online sales currently represent about 13% of Best Buy sales, with the percentage increasing. Best Buy is also facing added stress to their distribution systems as they compete with Amazon. They are working to match Amazon’s two-day shipping, and in 40 marketplaces are offering same day delivery, again in response to Amazon. They are accomplishing this through three-party delivery firms.

Best Buy is using several tactics to meet this increased demand on distribution centers. The article mentions increased inventory, pre-packaging items for shipment, increasing capacity by operating 24 hours a day versus normal 10-12 hours a day, and the use of software to determine from where the items are shipped.

Discussion Questions
1. Should Best Buy be competing against Amazon by offering 2-day delivery, Continue reading

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Oh, Christmas Tree

Oh, Christmas Tree

December 18, 2017

Article Title: Christmas tree shortage’s roots go back to 2008 financial crisis

Author of Article: Meg Oliver

Date of article: December 3, 2017

Source URL: https://www.msn.com/en-us/money/markets/christmas-tree-shortages-roots-go-back-to-2008-financial-crisis/ar-BBG3FuZ

Prices of Christmas tree this year are 5 to 10% higher than last year because of a tree shortage.

Demand for Christmas trees plummeted 9 years ago as a result of the financial crisis causing growers to go out of business or plant fewer trees.  As it takes 7 to 10 years for a Christmas tree to grow, the tree shortage will continue through 2019. There are simply not enough Christmas trees to meet demand, especially for small local tree retailers.

Discussion Questions
1. What are the challenges of demand forecasting for items such as Christmas trees?

Guidance: Discussion may focus on seasonal fluctuations, demand substitution and price sensitivity.

2. What are the components of the Christmas tree supply chain?

Guidance:  Growers → Loggers → Wholesalers → Retailers

3. What are the difficulties facing small retailers in managing their Christmas tree inventory?

Guidance: Discussion may focus on shortage costs, demand uncertainty, and supply uncertainty.

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