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Retail & Allocation lesson

Hold some back

This company sends 70% to the stores now and keeps 30% back at the warehouse. Each store gets its share of weekly sales.

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About 5–10 minutes · no sign-up needed

The idea

This company sends 70% to the stores now and keeps 30% back at the warehouse. Each store gets its share of weekly sales:

Formulas

Total units × ( 1 − Holdback )
Send now × Share of sales

Key points

Why hold backA new product has no sales yet. Keep some back, then top up the stores that sell fastest.
Send nowWhat goes out on day one. 1,200 × (1 − 0.3) = 840.
Each store's shareToronto has 40 ÷ 120 = 0.33 of sales, so 840 × 0.33 = 280.

Many retailers hold back 20% to 40% of a new line. Top up from it once week 1 shows where it sells.

Practice

Try each one in your head first, then open the answer.

1. 1,200 units arrive, and 30% is held back. How many go out to the stores now?
1,200 × (1 − 0.3) = 840
2. 840 units go out now. In D4, work out Montreal's units.
=840*C4
3. After week 1, which store should get the first top-up from the warehouse?
Montreal sold 80% of its units in one week.
4. Why hold back stock on a new product, instead of sending it all out?
No one knows yet which stores will sell it fastest

Learn it by doing. This lesson is a short hands-on level on Bampaa: see it work, then build and write it yourself, with instant feedback.

Try this lesson free →
About 5–10 minutes · no sign-up needed