1. How does the use of a robotic shopping assistant impact the breakeven point and operating leverage at Lowe’s?
Original blog posting (November 12, 2014)

2. Lowe’s is using a robot in a store
Robotic shopping assistant called OSHbot
One store in San Jose, California
Will greet customers and assist them in finding products
Large screen on front and on back for displaying help and for displaying ads

3. Same navigation technology as used in Google’s driverless cars
Robots are expensive right now
Navigation system alone is speculated to have cost $50,000
Assume that a “typical” customer service associate at Lowe’s is paid hourly and works between 10 – 30 hours per week

4. Question 1
What type of cost (fixed, variable, or mixed) is represented by the wages and benefits paid to a customer service associate at Lowe’s? Justify your answer.

5. Question 2
What type of cost (fixed, variable, or mixed) is cost of the OSHbot at Lowe’s? Explain.

6. Question 3
Assume that each OSHbot can replace four customer service associates at the store. How does the change in cost structure at the store impact the store’s breakeven point? Explain.

7. Question 4
Again assume that each OSHbot can replace four customer service associates at the store. How will OSHbot impact the store’s operating leverage factor? Explain.

8. Question Recap
What type of cost (fixed, variable, or mixed) is represented by the wages and benefits paid to a customer service associate at Lowe’s? Justify your answer.
What type of cost (fixed, variable, or mixed) is cost of the OSHbot at Lowe’s? Explain.
Assume that each OSHbot can replace four customer service associates at the store. How does the change in cost structure at the store impact the store’s breakeven point? Explain.
Again assume that each OSHbot can replace four customer service associates at the store. How will OSHbot impact the store’s operating leverage factor? Explain.

9. For additional news stories to use in the accounting classroom, see the Accounting in the Headlines blog at Related video resources can be found at Questions or comments? Contact Dr. Wendy Tietz at