Choice of Sector : Retail

Observation & Introduction Observe Market Generally Market Structure Introduction Rush hours Days of Rush Purchasing Cycle 1st Week of the month Ist Sunday Eid Public Holidays Ramzan

Situation
Passage of customers through a retail outlet checkout

Arriving Customers
Shoppers

Service Facility
Checkout/cash counters

Problem Statement
Why does the queues formed at chase up are too long during peak hours? Objective: Analysing the Bottle Neck at chase ups cash counter during peak hours i.e. - weekends, - occasional holidays, - first week of every month - Seasonal Sales Need of this analysis arises as we observe the unsystematic way of queuing at Chase. We characterized our Queuing Analysis in terms of store location i.e. Bahadurabad.

 In order to analyse and solve the queuing management system at Chase up, we will use a single stage queuing model with multiple queues and multiple servers.

Arrival Characteristics
Size of the calling population? - Infinite: The source of customers can be finite or

infinite. For example, all people of a city or state (and others) could be the potential customers at a retail outlet. The number of people being very large, it can be taken to be infinite.
Patterns of arriving? - Random: Arrivals are considered random when they are independent of one another and their occurrence cannot be predicted exactly. Behavior of the arrivals i.e. patient or balking? - Depends on time of the day or day of the week

Waiting Line Characteristics

Length of line - Infinite Queue discipline

- FIFO: (First in, First out): a customer that finds the service
center busy goes to the end of the queue.

Service Facility Characteristics

Configuration of service system (no of servers and phases)? - 10 servers; single phase Service time distribution (constant or random)?

Opens at 11 am (Fridays 3 pm) Rush Timings start from 6 pm Peak hours 9 pm 11 pm Foot fall - 200 -300 people at a time Days : Friday, Saturday, Sunday Layout : 7 grocery cash counters 2 garments 1 pharmacy

Primary Data:
Observations

The observations for number of customers in a queue, their arrival-time and departure-time were taken without distracting the employees. The whole procedure of the service unit each day was observed and recorded using a time-watch during the same time period for each day.
Telephonic interview Face to face (customer interaction)

Qualitative Data:

Quantitative Data Waiting lines

= Mean number of customer arrivals per time period = Mean number of customers served per time period = Utilization factor for the system L= Average number of customers in the system Lq= Average number of customers waiting in the system W= Average time each customer spends in the system Wq = Average time each customer spends in the queue

 = 400 customers arrive per hour on average = 41 customers served per hour on average by each counter Operating Characteristics L Present System 46 customers

Lq
W

37 customers
6.94 mins

Wq
U

5.48 mins
0.98

Alternative 1: Mobile cash counter to accommodate additional customers during peak hours through effective utilization of space. = 400 customers arrive per hour on average = 39 customers served per hour on average by each counter
Operating Characteristics Alternative 1

L Lq W Wq U

21 customers 10 customers 3.12mins 1.65mins 0.89

Assumption: Each one-minute reduction in customer waiting time avoids Rs.1000 in lost sales per week. Cost: Mobile cash counter = PKR 15000 (one-time cost) - No additional costs in terms of hiring additional staff, will be managed by an existing employee. Benefit: Reduction in minutes= 5.48-3.25=2.23 minutes Per week extra savings = 2.23 * 1000= Rs. 2230 Mobile Cash Counter is paid off in 7 weeks

Alternative 2: 2 additional cash counters. = 400 customers arrive per hour on average = 37 customers served per hour on average by each counter Operating Characteristics Alternative 2 L Lq W Wq U 15 customers 4 customers 2.19mins 0.8mins 0.87

 Cost of a new counter= Rs25000 i.e. Rs50000 for 2 counters Cost of additional employee= Rs1000/week i.e. Rs2000 for 2 employees Reduction in minutes= 5.48-0.8=4.68 minutes Weekly Savings= 4.68*1000= Rs4680-2000=Rs2680 Counters are paid off in 50000/2680= 19 weeks After Rs50000 recovered, alternative 2 would provide Rs2680-2230= Rs450 more savings per week.

Alternative 2: Happy Hour i.e. 20% additional discount on all discounted items on weekends morning i.e. 12pm3pm. Cost- Have to forgive the Profit Margin from 5Additional 5% of cost Benefit: