1) PLEASE CALCULATE NPV COST AND TOTAL COST ROW FOR BOTH NEW POTENTIAL D.C AND CURRENT D.C

2) BASED ON THIS DATA Which option makes more financial sense from a total cost perspective and from a cost per piece perspective? (should you stay in the current distribution center or move to the new one? why?)

3) What is the break-even point of the cost-efficient option?

4) What are the main drivers supporting the most cost-efficient option and what could be the underlying reasons for these costs?

New Potential D.C. 5 Year P&L Square Feet # of Stores Pieces to Stores Sales Connected to Stores Rent Salary Cost Operational Cost Transportation Total Cost Cost per piece Full Capacity % to Full Capacity 2020 2021 2022 2023 2024 580,000 580,000 580,000 580,000 580,000 152 157 161 166 172 30,000,000 30,900,000 31,827,000 32.781,810 34,093,082 450,000,000 463,500,000 477,405,000 491,727,150 511,396,236 657,140 676,854 697,160 718,075 739,617 6,272,100 6,460,263 6,654,071 6,853,693 7,127,841 7,878,000 8,114,340 8,357,770 8,608,503 8,952,843 1,212,000 1,248,360 1,285,811 1,324,385 1,377,361 16,019,240 16,499,817 16,994,812 17,504,656 18,197,662 1.872748021 1.872748021 1.872748021 1.872748021 1.873487002 41,244,444 41,244,444 41,244,444 41,244,444 41,244.444 73% 75% 77% 79% 83% NPV Cost Total Cost 6,000,000 Investment Dcto Rate 59 Current D.C. 5 Year P&L Square Feet # of Stores Pieces to Stores Sales Connected to Stores Rent Salary Cost Operational Cost Transportation Total Cost Cost per piece Full Capacity % to Full Capacity 2020 2021 2022 2023 2024 450,000 450,000 540,000 540,000 540,000 152 157 161 166 172 30,000,275 30,900,284 31,827,292 32,782,111 34,093,395 450,004,131 463,504,255 477,409,383 491,731,664 511,400,931 413,100 421,362 716,040 730,361 744,968 6,817,500 7,022,025 7,232,686 7,449,666 7,747,653 8,181,000 8,426,430 8,679,2238,939,600 9,297,184 1,515,000 1,560,450 1,607,264 1,655,481 1,721,701 16,926,600 17,430,267 18,235,212 18,775,108 19,511,505 $ 1.77 $ 1.77 $ 1.75 $ 1.75 $ 1.75 32,000,000 32,000,000 38,000,000 38,000,000 38,000,000 94% 97% 84% 86% 90% NPV Cost Total Cost 0 Investment Dcto Rate Investment 4,000,000 5% 4,000,000 New Potential D.C. 5 Year P&L Square Feet # of Stores Pieces to Stores Sales Connected to Stores Rent Salary Cost Operational Cost Transportation Total Cost Cost per piece Full Capacity % to Full Capacity 2020 2021 2022 2023 2024 580,000 580,000 580,000 580,000 580,000 152 157 161 166 172 30,000,000 30,900,000 31,827,000 32.781,810 34,093,082 450,000,000 463,500,000 477,405,000 491,727,150 511,396,236 657,140 676,854 697,160 718,075 739,617 6,272,100 6,460,263 6,654,071 6,853,693 7,127,841 7,878,000 8,114,340 8,357,770 8,608,503 8,952,843 1,212,000 1,248,360 1,285,811 1,324,385 1,377,361 16,019,240 16,499,817 16,994,812 17,504,656 18,197,662 1.872748021 1.872748021 1.872748021 1.872748021 1.873487002 41,244,444 41,244,444 41,244,444 41,244,444 41,244.444 73% 75% 77% 79% 83% NPV Cost Total Cost 6,000,000 Investment Dcto Rate 59 Current D.C. 5 Year P&L Square Feet # of Stores Pieces to Stores Sales Connected to Stores Rent Salary Cost Operational Cost Transportation Total Cost Cost per piece Full Capacity % to Full Capacity 2020 2021 2022 2023 2024 450,000 450,000 540,000 540,000 540,000 152 157 161 166 172 30,000,275 30,900,284 31,827,292 32,782,111 34,093,395 450,004,131 463,504,255 477,409,383 491,731,664 511,400,931 413,100 421,362 716,040 730,361 744,968 6,817,500 7,022,025 7,232,686 7,449,666 7,747,653 8,181,000 8,426,430 8,679,2238,939,600 9,297,184 1,515,000 1,560,450 1,607,264 1,655,481 1,721,701 16,926,600 17,430,267 18,235,212 18,775,108 19,511,505 $ 1.77 $ 1.77 $ 1.75 $ 1.75 $ 1.75 32,000,000 32,000,000 38,000,000 38,000,000 38,000,000 94% 97% 84% 86% 90% NPV Cost Total Cost 0 Investment Dcto Rate Investment 4,000,000 5% 4,000,000