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University Bookstore
Author(s):
McDougall, Duncan C.
Vollmann, Thomas E.
Functional Area(s):
   Operations Management
Setting(s):
   Nonprofit
Difficulty Level: Beginner
Pages: 2
Teaching Note: Not Available. 
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First Page and the Assignment Questions:
Most of the year was "library-like" at the Textbook Department of the University Book Store, according to Marilyn Copp, the department manager.  But the two weeks after Labor Day and the second two weeks of January were quite the opposite.  She explained ( (See Figure 1 for a process flow):

Semester start-ups put enormous pressures on us.  Last semester, in the twelve 9 AM to 9 PM workdays of those two weeks, we served 21,600 customers.  I must admit, we didn't serve them all as well as I'd have liked.  I am hoping to do much better in January.

A study done this past fall shows that we can expect 10% of our early semester customers to buy one book, 20% to buy two, 25% to buy three, 30% to buy four, and 15% to buy five books.  Customers who come in can ask for help at the information desk, but the shelf areas for the many schools, departments and courses are clearly marked, so most customers help themselves.  Then they come to the cash registers to check out.  That's where we feel the most pressure.

The checkout counter had four electronic cash registers.  The cashiers' task included:

1.    Keying into the register an inventory code number and a price for each book (Time required:  0.1 minutes per book); and

2.    Bagging books and receiving payment either by

a.    Collecting cash and making change  (Time:  0.4 min per customer),

b.    Waiting while the customer wrote a check, then taking down the customer's identification data  (Time:  1.2 min per customer), or

c.    Running a credit card through the register's automatic approval device, filling out a charge slip while waiting for an approval code, getting the customer's signature, and returning the card (Time: 1.0 min per customer).

Store records indicated that about 40% of textbook customers paid cash, 40% paid by check, and 20% by credit card.

Demand during the first two weeks was fairly level, except during the first two days.  Ms. Copp estimated that the first two days were by far the busiest, with their total volume per day double the average daily volume of the twelve-day period.  The busiest hours on those peak days were between noon and 4:00 PM, when students came to buy books just after attending their first classes.  Ms. Copp said that customer arrivals during those peak hours ran at three times the average rate over the twelve days.  "That's when the department gets its reputation for poor service," she remarked.  "Those two afternoons each year can make or break my career with this company.  This January I want to manage them much better than I did last fall.  Can you help?"       
Assignment

1.    What is the capacity of the bookstore checkout stations in customers per hour?

2.    What is the average hourly demand during the peak periods of the first two weeks of the semester?

3.    What should the manager at the bookstore do?