1. Guthrie’s Measures of Product Profitability on Product Line BA 315/4700 MARKETING MANAGEMENT

2. Guthrie’s 1990 SALES $ 1,410,000 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Square Foot 12,000 4,000 6,000 600

3. Guthrie’s 1990 SALES $ 1,410,000 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Sales Per Square Foot 800,000/12,000 = 66.7 150,000/4,000 = 37.5 400,000/6,000 = 66.7 600,000/600 = 1,000

4. Guthrie’s 1992 SALES $1,810,000 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Square Foot 10,000 3,000 8,000 1,600

5. Guthrie’s 1992 SALES $1,810,000 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Sales Per Square Foot 850,000/10,000 = 85 120,000/3,000 = 40 600,000/8,000 = 75 240,000/1,600 = 150

6. Guthrie’s 1990 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Inventory Turnover 800,000/200,000 = 4 150,000/25,000 = 6 400,000/100,000 = 4 600,000/120,000 = 5

7. Guthrie’s 1992 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Inventory Turnover 850,000/200,000 = 4.25 120,000/18,000 = 6.7 600,000/125,000 = 4.8 240,000/40,000 = 6

8. Guthrie’s 1990 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Gross-Margin Return Per Square Foot 66.7 x.30 = 20.01 37.5 x.40 = 15 66.7 x.25 = 16.675 1,000 x.30 = 30.0

9. Guthrie’s 1992 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Gross-Margin Return Per Square Foot 85 x.25 = 21.25 40 x.40 = 16 75 x.25 = 18.75 150 x.25 = 37.5

10. Guthrie’s 1990 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Gross-Margin Return on Inventory Investment 4 x.30 = 1.2 6 x.40 = 2.4 4 x.25 = 1 5 x.30 = 1.5

11. Guthrie’s 1992 Product Line  Kitchen  Phonographic  Television  VCR/Videodisc Gross-Margin Return on Inventory Investment 4.25 x.25 = 1.0625 6.7 x.40 = 2.68 4.8 x.25 = 1.2 6 x.25 = 1.5

12. Guthrie’s  SPACE IS THEIR CRITICAL ASSET  Sales growth coming from TV, can support the increased space devoted to TV-VCR… sales probably correlated  ex TV +$200,000with 2000ft addition ($100/sq ft) (can debate the productivity of this added space)  Phono highest GMROI but lowest on GM/sq ft  KITCHEN STILL MAJOR LINE, WEAK SALES GROWTH, LOW GMROI BUT NEEDS THIS FOR ASSORTMENT

13. The End Guthrie’s