ALFREDO M.

VELAYO COLLEGE OF ACCOUNTANCY

UNIVESITY OF SANTO TOMAS
Espaa, Manila

OPERATIONS MANAGEMENT QUIZ

FEATURING:

PINK GOLD SHOP

Submitted by:

Castelo, Chelsea

Cruz, Pamela

Paragas, Ma. Carla

Puzon, Elaine Marie

Sison, Pauline Andrea

Submitted to:

Mr. Mark Lester Toribio

May 10, 2017

PINK GOLD SHOP

I.

HISTORY

In todays economy, people engage in different businesses that

produce goods or provide services that satisfy the needs and wants of the
consumers. It may be a sole proprietorship, partnership or a corporation.
With regards in providing products, it may be merchandising or
manufacturing.

Even though were still young, we also want to have our own business.
It may be hard to achieve right now but we believe that it is not impossible
to do so in the future. As early as now, we want to know how to manage a
business and what system we should apply in order for our business to grow
and become successful. So, we decided to interview a company to learn
these things.

The company that we have chosen is one that is well-known in the UST
Community which is Pink Gold. We all know that Pink Gold is located in the
second floor of the car park. Almost everything can be found here, from food
to books to UST merchandise. But dont you ever wonder why it was named
PinkGold and how did they start their business?

The Pink Gold Shop is owned by a sole proprietor named Nida R.

Macapagal. The term Gold in Pink Gold came from her first business that is
related to jewelry and the term Pink was included because it represents
girls that commonly likes things that are color pink. She said that the idea of
putting up a general merchandise business came from her mother. When she
was young, they used to own a store. Also, she said that it is her passion.
She wants to provide ease of access to school supplies, among other things,
to the students. They didnt have to go out of the campus in order to buy the
supplies that they need because the store is accessible and almost
everything can be found there.

II. INVENTORY AND OPERATIONS

The Pink Gold Shop offers a variety of products. Among these are
school supplies, snacks, drinks, UST shirts and souvenirs. Because their
business is engaged in merchandising, rather than producing their own
products, they purchase it from outside suppliers. The stores owner, Maam
Nida, mentioned that they have various suppliers for each category of
product. The school supplies are purchased from suppliers in Binondo,
Manila, the snacks and drinks are provided by agents that distribute the
products of different food companies while the UST shirts and souvenirs are
also provided yet again, by other suppliers.

Because the Pink Gold Shop is a general merchandise business, they

have their merchandise inventory which includes all the products that they
are selling. In order to have a proper accounting of their inventory, the Pink
Gold Shop uses the First in First out (FIFO) Method. In the FIFO Method, the
first products that have been purchased are the first ones sold. This is used
as a method for valuation of inventory where the costs of the products which
are first purchased are assumed to be the costs of the products that are first
sold. However, for the food products that the Pink Gold Shop sells, the FIFO
Method is also used for the physical flow of the goods being sold. The main
reason for doing it is because the food products have expiration dates and
needed to be sold before they expire. According to Maam Nida, the Pink Gold
Shop accounts for their inventory every 15 days.

The Pink Gold Shop is located inside the UST Campus which makes it
really convenient for students because they do not need to go outside in
order to buy what they need if it is already available in the store. As a result,
the demand for the products that the Pink Gold Shop sells must be high. This
fact necessitates the question on how often the store needs to order supplies
for the different products that they offer. When asked, Maam Nida said that
they order food products once every week and restock their school supplies
and UST souvenirs every month.

When it comes to the quantity of products that are ordered, Maam

Nida said that their basis is the demand for that particular product. Those
products that have high customer demand are purchased in bigger volumes
than those which are not highly demanded. According to Maam Nida, the
demand for each product is determined by the customers tastes and
preferences. Products that are more preferred by customers are sold faster
than products that are not generally preferred. This scenario follows the Law
of Supply and Demand. When the customers demand for the product is high,
the seller will also increase the supply of those products because they can
obtain more profit in selling those products.

It is not new for businesses that sell food products to experience

having products, still in their inventory, that have already passed their
expiration dates. This may be because these products are not frequently
bought by customers. The Pink Gold Shop considers these products as waste
and disposes them. Although school supplies and UST shirts and souvenirs
do not have expiration dates, these products are not immune to damages.
Whenever this is encountered, the Pink Gold Shop returns these damaged
products to the suppliers for replacement. Sometimes, the store receives
products that are not damaged but are not of good quality. When this
happens, they think that it is better to just pull these products out.

As we further ask questions we also found out that Pink Gold Shop are open
from Monday to Saturday except for holidays. Their store hours are from 7:00 in the
morning until 7:00 in the evening.

When it comes to their employees, the number of them usually depends on

whether there are a lot of buyers coming or only few. As we noticed, when UST has
an upcoming match, a Yellow Day will be announced beforehand to support the
team, due to this, many customers especially students are coming to their store to
purchase their UST shirts. During that time, around 4 to 5 employees are designated
at the shop. On the contrary, there are only 2 employees when it is an ordinary day.

III. SUGGESTIONS AND RECOMMENDATIONS

Based on the information that we have acquired, there are some suggestions
and recommendations that we have formulated. Pink Gold is a type of General
Merchandise in which goods are not produced but rather retailed. From T-shirts,
beverages, snacks, school supplies and accessories, they surely have it all. In
addition, their stores location is really perfect because it is inside the school which
is easily accessible for students without any hassle. However, the space they
occupied is small enough for their category. We suggest that they should expand
their space in order to make sale transactions more convenient.

In terms of their product, they said that some of the goods they sold which
have met the expiration dates are sometimes thrown out. Due to this, it is better if
they sale those items which is at least a day or 3 before the expiration in a cheaper
price in order to not become a waste. As a consequence, they did not only save the
product but also made a profit.

When it comes to buying T-shirts, we can never avoid buying the wrong size
especially if we did not fit it. In line with this, it is better for Pink Gold to allot a
fitting room for the customers in order for them to wear it freely without hassle.
They may be able to find their right size and could buy more than they should.

Their products surely vary which makes it flexible and available for the
students needs. However, some of the products they are selling are not shown and
are hidden which cannot be easily seen. We recommend that they should organize
their products for more convenience. This would also help the customers see all the
products that they are offering for sale.