Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Advanced Pharmaceuticals, Inc., is a wholesale distributor of prescription drugs to independent retail and hospital-based pharmacies Management believes that top notch customer representatives we the

image text in transcribed
Advanced Pharmaceuticals, Inc., is a wholesale distributor of prescription drugs to independent retail and hospital-based pharmacies Management believes that top notch customer representatives we the key factor in determining whether the company will be successful in the shore Customer representatives serve as the company's son with customers helping pharmacies monitor their stocks, devening drugs when customer stocks run low, and providing up-to-date information on drugs from many different companies. Customer representatives must beutrareable and we haghoy trained Good customer representatives are hard to come by and are not easy replaced Customer representatives routinely record the amount of time they spend serving each pharmacy. This time includes travel time to and from the company's central warehouse as well as time spent replenishing stocks, dealing with complaints, answering questions about drugs, forming pharmacists of the latest developments and newest products, reviewing bills, explaining procedures, and so on some pharmacies require more and hoking and attention than others and consequently they consume more of the representatives time. Recently, customer representatives have made more frequent complaints that it is impossible to do their jobs without working wel beyond normal working hours. This has led to an alarming increase in the number of customer representatives quitting for jobs in other organizations. As a consequence, management is considering dropping some customers to reduce the workload on customer representatives Data concerning a representative Sample of the company's customers appears below Providence Leaterest Hos Clinic Jenkins Pharmacy Pharmacy Pharmacy Prama Total revenues $2954310 5297260 $1.49 250 5224670 Cost of drugs sold 3238 470 $2.252.480 51,187 446 5133.00 Customer service costs $10730 $77.100 $06.500 58.90 Customer representative 135 1420 650 170 Customer service costs include all of the costs-other than the costs of the drugs themselves that could be avoided by dropping the customer. These costs include the hourly wages of the customer representatives, their sales Commissions the mileage-related costs of the customer representatives company provided vehicles and so on Required: 1. Ranke for customers in terms of the prototy Leaf Providence Madison Hospital ink Jenkins Pharmacy Rank based on profitability index

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Commercial Printing IRS Audit Techniques Guide

Authors: Internal Revenue Service

1st Edition

1304133753, 978-1304133755

More Books

Students also viewed these Accounting questions