proutet-and many times tory is higher. You have to get this thing under control." it's late. That takes people and time. It drives us crazy We shouldn't sell all of these things. You just can't keep Ques enough inventory." Questions 1. Why, in your opinion, is senior management so con- Gil continues, "But adding product every day just cerned about the "high" inventory levels at Champion makes it worse. Marketing always makes the case that it is our strategy to supply customers a full line' of supplies- that means we have to add a product if there is demand for Electric? What steps would you suggest that Barb take in addressing the concerns of President Campos? 2. CASE Tasty Treats Tasty Treats is a distributor of candy and snack products of Chocolate Chewies every 10 days. I also try to keep an serving customers in a six state region of the midwestern extra 200 cases on hand just in case something unexpected United States. Bill Jones, chief operations officer, has been happens. Sometimes we run out of stock anyway and some- concerned about inventory levels and inventory perfor- times I look and see an enormous number of cases of Choc- mance at Tasty Treats for quite some time. In speaking with olate Chewies on hand. The same basic approach is used for Jim Busfield, chief executive officer of Tasty Treats, Bill every item we sell. There's got to be a better way" voiced some of his concerns: "Jim, we carry over 5,000 dif. Jim briefly thought over Bill's concerns before he ferent items in inventory. I have a feeling that we just don't replied. "I think you're right, Bill. As you know, my back- have a good handle on the proper approach to managing this ground is in finance, not operations, but I can tell you that part of our operations. We don't have any real analysis that we have a lot of money tied up in inventory and we spend tells us how much we should carry of each item. We just use a lot of money not just in buying it but in maintaining it, ple rules of thumb to determine how much we should too. We pay insurance, taxes, and a lot of other costs just better, order from our suppliers. For example, we sell an average of because of the amount of inventory. If we manage it 100 cases of Chocolate Chewies every day. When we order we may be able to free up a lot of capital, too. There has to Chocolate Chewies from our supplier, it usually takes about be a more sophisticated approach than what we are doing 10 days for us to get the order. So, we order 1,000 cases I tell you what let's do. We have a summer intern who is 278