Question

1. Which of the following merchandise categories would have the highest days of supply? Explain.

A. Kid clothes

B. Fruits and vegetables

C. casual footwear

D. fine jewelries

Answer 1

Days of supply means the total number of days it will take for a specific stock on the shelf to run out of shelf if sales volume moves at the constant rate. Days of supply helps in calculating the number of days required to buy new inventory in order to meet regular supply. In the provided options fine jewelleries would take maximum days to run out of shelf as it is the least consumed items of all while fruits and vegetables would have the least days of supply as their consumption is high among people. Therefore, the correct option is (D). The rest of the items (casual footwear and kid clothes) will take moderate days as compared to fruit and vegetables and fine jewelleries.