HHI buys most of its inventory directly from the manufacturers, but it does buy some items
from distributors. Most items are shipped to one of HHI’s three warehouses, but some items are shipped directly to the store locations. HHI has a new companywide inventory control system that
was just installed last year at a cost of about $200,000. This information system monitors inventory
in real time. When a new shipment arrives at an HHI store, it is entered into the system on the
receiving dock. Each item is bar coded so it can be tracked as it moves from the receiving dock
to the warehouse to the store shelf and, finally, out the door past a point-of-sale terminal (which
Hal still calls a cash register). This inventory-tracking system is accessible through a Web browser
and can be connected to a Web site, so HHI could sell inventory from its existing warehouses and
stores through the Web. The cost for the software is $42,000, including installation and
configuration.