Your small retail shop specializes in high-end mountain bikes. At this time your store does not have any other products. You buy them from the distributors and stock them in your shop. You have one employee beside yourself to help assemble and sell these bicycles. You need to develop a simple spreadsheet model to help you monitor the operations of this business and to help you track your projected profit (or loss) for the coming year. You would like to know which bikes are the most profitable, and you need to be able to see how other costs such as rent and utilities might affect your overall net profit or loss within that time frame. You have decided to develop a model using an MS Excel spreadsheet. It is intended that this model will become a part of your Decision Support System (DSS). It should provide an instant answer as to the profitability of a given product at a given cost or selling price. It must also allow you to examine different scenarios when manipulating the product line offered and the set of key variables such as markup, rent, and utilities. The selling price is based on a percentage markup over the cost and is derived by a formula.
Do NOT join the tables into one. Make them separate.
When done with your analysis, write a description in a separate MS Word document of the following: Bike’s Shop problem, the three possible course of action to increase profit, and the one option that you would recommend as the most effective in making the Bike Shop profitable. Be specific on the changes that would result in the Excel model if each option was implemented (i.e., test each one using the model). Remember, in providing a recommendation onwhat is the best optionbe critical and ensure the recommendation is feasible and will bring about the desired results.
In the 2nd part, the three options must be done using Excel calculations.
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