1. 1) Identify and close the least profitable stores.
We look at profitability, profit and cost figures for each store and all the stores together. In the below
table we present the figures for these metrics in the current scenario and of the stores with profitability
below a certain % are closed. The total number of stores is 453.
Profitability
Profit
Cost
Case
KPI
PROFIT
COST
RETAIL
Reduction
Reduction
Current
10.48% $87,330,929.80 $746,335,208.60 $833,666,138.40
0
0
Close if
<5%
10.72% $86,209,680.74 $717,967,886.64 $804,177,567.38
-1%
-4%
Close if
<6%
10.93% $84,479,503.11 $688,258,308.45 $772,737,811.56
-3%
-8%
Close if
<7%
11.19% $81,688,367.67 $648,027,483.68 $729,715,851.35
-6%
-13%
Close if
<8%
11.60% $76,137,670.20 $579,990,413.53 $656,128,083.73
-13%
-22%
Close if
<9%
12.09% $68,775,160.42 $500,148,820.22 $568,923,980.64
-21%
-33%
Close if
<10%
12.97% $55,364,616.03 $371,455,464.08 $426,820,080.11
-37%
-50%
If we close the stores with profitability less than 5%, then we will lose 1% of our profits but cut 4% of our
costs. We improve our Profitability by .24%. We would be closing 17 stores (4% of the total stores).
Similarly, if we close the stores with profitability less than 6%, then we will lose 3% of our profits but cut
8% of our costs. We improve our profitability further by .21%. Notice that the gain is not significant as in
the first case. We would be closing 33 stores (7% of the total stores).
For other cases, the loss in profitability is >5% and hence we do not recommend them at this point of
time.
Between 5% and 6% scenarios, we notice that in the 5% scenario, the ratio between drop in profit to
drop I cost is 1:4 whereas it is just 1:2 in the 6% case. So we recommend shutting down the stores that
have profitability below 5%.
The store Ids of these stores are:
104
1704
2603
6803
9603
4803
9303
303
6302
2503
5303
9503
7502
4904
6202
903
703

2. By shutting down these stores, Dillard’s can save costs of $28,367,321.96 and lose only $1,121,249.06
of profits.
2) Reduce hours of its least profitable stores.
The following graphs show the sales at 3 of the least profitable stores by day of week.
Store 1704
350000
300000
Total Sales
250000
200000
150000
100000
50000
0
1
2
3
4
5
6
7
(blank)
7
(blank)
Day of week (1- Sunday to 7-Saturday)
Store 2603
1400000
1200000
Total Sales
1000000
800000
600000
400000
200000
0
1
2
3
4
5
6
Day of week (1- Sunday to 7- Saturday)

3. Store 6803
1200000
Total Sales
1000000
800000
600000
400000
200000
0
1
2
3
4
5
6
7
(blank)
7
(blank)
Day of Week (1- Sunday to 7- Saturday)
Store 9603
1600000
1400000
Total Sales
1200000
1000000
800000
600000
400000
200000
0
1
2
3
4
5
6
Day of Week (1- Sunday to 7- Saturday)
From the above 3 graphs, we can infer and generalize that the sales are at their peak on Saturdays and
at a minimum on Sunday and Monday. So Dillard’s should shut down its stores on Sunday and Monday
and may be run for extra hours on Saturday to ensure increased profitability.
3) Discontinue some of the least profitable products in stores where those products are generating
the least profit.
Row Labels
POLO FAS
TAHARI/A
KASPER A
JONES/LA
CM SHAPE
Grand Total
Values
Profitability KPI
-7.23%
-25.37%
-34.21%
-8.26%
-28.62%
-11.14%
PROFIT
COST
($5,318,174.05)
($2,530,652.09)
($2,190,958.14)
($1,396,706.08)
($1,374,197.30)
($17,144,991.61)
$78,851,708.39
$12,507,192.34
$8,594,751.05
$18,310,205.80
$6,175,952.64
$171,078,016.81

4. The above table shows 5 brands with least profit (maximum losses). By removing these brands from
the stores where they are causing losses, we arrive at the following figures for each of these brands.
Curre
nt
Profit
ability
Brand
Current
Profit
Current
Cost
POLO FAS
$ (5,318,174.05)
$ 78,851,708.39
TAHARI/A
$ (2,530,652.09)
KASPER A
Future
Profita
bility
Future
Profit
Future
Cost
-7%
$ 68,141.95
$
711,995.81
9%
$ 12,507,192.34
-25%
$ 124,642.50
$
705,779.15
15%
$ (2,190,958.14)
$
8,594,751.05
-34%
$
$
4,987.81
13%
JONES/LA
$ (1,396,706.08)
$ 18,310,205.80
-8%
$ 399,788.20
$ 5,950,380.06
6%
CM SHAPE
$ (1,374,197.30)
$
6,175,952.64
-29%
$
$
20,457.34
0%
Overall
$ (12,810,687.66)
$ 124,439,810.22
-11%
$ 593,328.12
$ 7,393,600.17
7%
727.93
27.54
From these two tables, we can see that by eliminating the 5 most unprofitable brands from the stores
where they are causing losses, we can improve our profits by $13,404,015.78 [Overall Future Profit –
Overall Current Profit] while reducing our costs by $117,046,210.05 (Overall Current Costs – Overall
Future Costs). The profitability from these 5 brands goes up from -11% to 7%.
The overall profitability goes up from 10.5% to 13.8%.
The table below summarizes the number of stores from which each of these brands needs to be
removed. Due to space constraints all the stores are not listed here but the top 5 stores with highest
losses related to this product are shown.
Brand
POLO FAS
TAHARI/A
KASPER A
JONES/LA
CM SHAPE
# of Stores
323
255
323
262
325
Top 5 Losing stores
1704, 4904, 2809, 9909, 5104
3603, 4903, 1703, 3403, 9603
2309, 3809, 1609, 3609, 3709
6009, 8109, 9309, 1203, 4603
8209, 3709, 3609, 9309, 3809

5. Appendix
Screenshots of Analysis
Question 1
Question 2

6. Question 3