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Convenience stores are looking at more competition from supermarkets, drugstores, and membership-warehouse clubs that have added gas pumps and faster checkouts. Therefore, cost cuts are needed to increase convenience stores’ competitive edge. Some retailers have found that it is cost-effective to stock only one brand of a product. Others found that stocking particular products cost the convenience store so much that it incurred a loss on the sale of that particular product. Using accounting software takes all of these costs into consideration and shows where nonprofitable products are losing money. It helps convenience stores increase sales and decrease costs.
1.Select one of the major convenience store in your town and research the store product, and list all of the types of costs that can be associated with a product.
2.Since cutting cost are needed to increase convenience stores’ competitive edge, in your professional judgment and based on your experience, which costs can be cut without affecting daily operations of the store. Please discuss your reasons for cutting the selected costs.
3.Using accounting software takes operating costs into consideration and shows where nonprofitable products are losing money. How does this software tool help to more accurately assess an item’s profitability? Do you think that this software is beneficial for convenience stores? Why or why not?
4.Do you think this software is beneficial?
5.Can you recall a personal situation in your career in which a company that you use to or currently are working for cut unnecessary costs? How cutting costs workout?