Customer-Level Planning

Circle K, a company of Alimentation Couche-Tard, operates a number of convenience stores worldwide. Assume that an analysis of operating costs, customer sales, and customer patronage reveals the following:

Fixed costs per store $125,000/year

Variable cost ratio 0.60

Average sale per customer visit $10.00

Average customer visits per week 2.00

Customers as portion of city population 0.05

Determine the city population required for a single Circle K to earn an annual profit of $75,000.

For customers required for desired profit and required population,round up to the nearest whole number(i.e., 325.333 customers = 326)

Annual contribution per customer: Answer

Customers required for desired: profit answer

Required population: answer