The Schmedley Discount Department Store has approximately 300 customers shopping in its store between 9am and 5pm on Saturdays. In deciding how many cash registers to keep open each Saturday, Schmedleys manager considers two factors: customer waiting time (and the associated waiting cost) and the service costs of employing additional checkout clerks. Checkout clerks are paid an average of $8 per hour. When only one is on duty, the waiting time per customer is about 10 minutes (or 1/6 hour); when two clerks are on duty, the average checkout time is 6 minutes per person; 4 minutes when three clerks are working; and 3 minutes when four clerks are on duty.
Schmedleys management has conducted customer satisfaction surveys and has been able to estimate that the store suffers approximately $10 in lost sales and goodwill for every hour of customer time spent waiting in checkout lines. Using the information provided, determine the optimal number of clerks to have on duty each Saturday to minimize the stores total expected cost.
Ashleys Department Store in Kansas City maintains a successful catalog sales department in which a clerk takes orders by telephone. If the clerk is occupied on one line, incoming phone calls to the catalog department are answered automatically by a recording machine and asked to wait. As soon as the clerk is free, the party that has waited the longest is transferred and answered first. Calls come in at a rate of about 12 per hour. The clerk is capable of taking an order in an average of 4 minutes. Calls tend to follow a Poisson distribution, and service times tend to be exponential. The clerk is paid $10 per hour, but because of lost goodwill and sales, Ashleys loses about $50 per hour of customer time spent waiting for the clerk to take an order. (Use Excel Format)
a.) What is the average time that catalog customers must wait before their calls are transferred to the order clerk?
b.) What is the average number of callers waiting to place an order?
c.) Ashleys is considering adding a second clerk to take calls. The store would pay that person the same $10 per hour. Should it hire another clerk? Explain.
Excerpt from file: Tutorial Assignment Application 2 Chapter 13: Waiting Lines and Queuing Theory Models Text Book: Quantitative Analysis for Management 11th ed., Render, Stair, Hanna. 13-10 The Schmedley Discount Department Store has approximately 300 customers shopping in its store between 9am and 5pm on Saturdays.
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