Examples of Present (Distribution Company) Costs
At Silver Sands Factory Stores, next to the Sandestin Golf and Beach Resort in Destin, Florida, shoppers find lush landscaping complete with palm trees and picture-perfect flowerbeds. There is a two-level, 30,000 square-foot family-entertainment center that offers activities and playrooms for children, as well as billiards and virtual-reality skiing and race-car driving for adults. (
Year 2001-SIC 6512)
Explanation: The lush landscaping and family entertainment center are part of the outlet center's Present Cost, which creates a nice ambience for the customer's shopping experience.
The new CEO of Toys R US is systematically stocking the top 1500 toys that make up two-thirds of the chain’s sales so that he can ensure that standbys, such as Monopoly, will be available in stores 90% of the time. (
Year 2000-SIC 5945)
Explanation: The systems ensuring the constant availability of the top 1500 toys are part of the Present Cost of Toys R US.
Some supermarket chains offer shopping amenities such as in-store branch banks, one-hour photo processing, party planning services, dry cleaning, and even child care. While many of these amenities generate higher margins, they are labor intensive, and generate higher payroll costs. (
Year 1997-SIC 5411)
Explanation: These additional services at supermarkets are part of the supermarket companies' Present Cost.
So far, Sears has been reluctant to cut merchandise categories and make space for the revamped departments it calls "power formats." The only new format in all 850 Sears stores is Brand Central, focusing on consumer appliances and electronics. (
Year 1990-SIC 5311)
Explanation: The spending on Brand Central is part of Sears' Present Costs.
Burlington Coat Factory typically displays apparel, accessories and luggage on circular racks and shelves on an open floor. Christopher Lowell's in-store boutiques stand out against the adjacent shelves of discounted bedding from big brands such as Ralph Lauren, Fieldcrest and Wamsutta. Each boutique features six to eight beds, fully made up with pillows and props, such as plants, and back-lit windows. (
Year 2001-SIC 5600)
Explanation: The in-store boutiques created for Christopher Lowell's Home Collection is part of Burlington Coat Factory's Present Costs.
To make the experienced-based formula work, the experience has to reflect the brand. The Sam Ash music store in Ontario Mills offers shoppers their own in-store performance space and the instruments to use in it. (
Year 1999-SIC 5999)
Explanation: The expenditures Sam Ash makes to create the performance space and the instruments to use in it are part of its Present Costs.