CBAP Practice Exam #11

Background: The Struggle at FashionDirect

Our team at FashionDirect is hitting a wall. On the surface, things look okay because the website is busy, but when you look at the actual profit margins, they’ve dropped by about 12% over the last year. The core of the issue seems to be a total disconnect between our digital systems and what is actually happening inside our 45 physical stores. We’re calling it "Inventory Blindness."

The Ground Reality

Right now, if you walk into one of our shops, there is an 18% chance you’ll walk out empty-handed. Why? Because you saw an item marked as "In Stock" on your phone, but when you got to the shelf, it wasn’t there. Our staff are constantly apologizing to frustrated customers. An audit confirmed our fears: our system records only match the actual hangers on the rack about 64% of the time. We are essentially flying blind.

It’s even worse for our online customers. When a local store tries to pack an order to ship it out quickly, they get the item wrong one out of every four times. Compare that to our main warehouse, where they almost never make mistakes. Every time a store sends the wrong shirt, it costs us a fortune in shipping and lost trust. Our finance team says that for every 1% we can claw back in inventory accuracy, we’d be looking at roughly $450,000 in recovered revenue every year.

The Fork in the Road

We have two main ideas on the table. The first is to just double down on what we have—better manual barcode scanners and more training. It’s cheap, maybe $500k, but it doesn't really fix the "blindness" problem.

The second option is the big one: switching everything to RFID tags. This would give us near-perfect data, but it costs $4.5 million. The Board is nervous; they’ve made it clear they won't sign off on that kind of money unless we can prove the project pays for itself in less than two years.

The Human Element

There’s also some internal friction. The Store Managers are already stressed out. They’re worried that if we make them tag every single garment by hand, they’ll be stuck in the back room instead of helping customers on the floor. Meanwhile, the CFO is losing patience with the bad data and wants a high-tech solution yesterday. We need to find a way to get the data the CFO needs without burning out our store teams.