Bath & Body Works Inc, Inventory Proposal for Qu

Inventory Proposal with Summer Historical Inventory Data

Introduction

Bath and Body Works (BBW) is a franchise owned by Limited Brands Incorporated. BBW sells personal care, beauty, and home fragrance products that are sold under the Bath and Body Works, CO Bigelow, and White Barn Candle brand names. Bath and Body Works is a very successful business and has grown to become one of the largest personal care retailers in the United States.

The inventory discussed below is that of a Bath and Body Works Flagship store. At this store there are two franchises occupying the same space respectively, Bath and Body Works and White Barn Candle Company. Currently this store uses the perpetual inventory system with the aid of point-of-sale registers (POS) using universal product codes (UPCs). This system currently keeps track of all removals from inventory on a continuous basis which, according to Stevenson, "allows the system to provide information on the current levels of inventory" (p. 527). This is an online system and is typically always up-to-date.

A problem that this inventory system faces is the added cost of record keeping. Handheld PCs need to be purchased, maintained, and updated often to ensure that the record keeping is always accurate. Another problem is the fact that a physical count of the inventory still has to be performed periodically to verify records due to the possibility of errors, pilferage, and many other factors that may reduce the effect amount of inventory. It is because of these problems that the company is seeking to implement a solution. The implementation of a new form of the perpetual inventory system offers a very simple elementary system. A benefit of this system is the fact that there is no need for recording each withdrawal from inventory. This option will reduce the costs associated with maintaining stock. It will also help manage low inventory levels effectively through sales, pilferage, and any errors that can reduce...