Operations and Project Management Case Study

Anamika Electronics – A Dilemma in Retail Electronics Supply Chain

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Abstract:
Anamika Electronics, a family-owned retail chain operating 25 outlets across Karnataka, confronts a critical challenge in its supply chain management. The traditional push-based inventory model, once profitable, now incurs significant losses due to rapid product obsolescence, escalating inventory carrying costs, and diminished consumer interest in discounted older models. CEO Raman Pandey and his leadership team deliberate a strategic shift to a pull-based model to mitigate financial strain and inventory risks. However, this proposed transition involves increased shipping, warehousing, and operational costs, along with potential declines in customer satisfaction and sales due to delays in product availability. Detailed financial analysis highlights substantial cost savings for high-value Elite and Premium categories under a pull strategy, whereas Budget and Mainstream categories exhibit mixed outcomes, advocating a hybrid approach. A controlled pilot in selected stores is recommended to assess customer response, operational efficiencies, and validate potential savings before company-wide implementation. Ultimately, Anamika Electronics seeks to balance inventory agility, financial sustainability, and customer expectations to ensure long-term competitiveness.

Pedagogical Objectives:

• To understand the operational differences between Push and Pull inventory strategies.
• To evaluate inventory carrying costs, obsolescence risks, and their effects on profitability in case of Push and Pull inventory strategy.
• To assess the financial and operational trade-offs associated with transitioning from a Push to a Pull inventory model.
• To develop analytical and strategic decision-making skills through real-world retail supply chain challenges.

Keywords : Inventory; Push and pull; Supply Chain Management; Supply Chain Costs; Warehousing Costs; Pick and Pack Costs; Transportation; Batch Shipping; Pricing; Product Life Cycle; Product Obsolescence; Showroom Model; Liquidation Cost; Depreciation; Product Markdowns