College - Author 1
College of Engineering
Department - Author 1
Industrial and Manufacturing Engineering Department
Degree Name - Author 1
BS in Industrial Engineering
College - Author 2
College of Engineering
Department - Author 2
Industrial and Manufacturing Engineering Department
Degree - Author 2
BS in Industrial Engineering
College - Author 3
College of Engineering
Department - Author 3
Industrial and Manufacturing Engineering Department
Degree - Author 3
BS in Industrial Engineering
College - Author 4
College of Engineering
Department - Author 4
Industrial and Manufacturing Engineering Department
Degree - Author 4
BS in Industrial Engineering
Date
6-2022
Primary Advisor
Jill Speece, College of Engineering, Industrial and Manufacturing Engineering Department
Abstract/Summary
Katie MacNamara acquired Legends Hair Salon in Atascadero, California in January of 2021. After a few months of learning to run her own business she discovered that her retail revenue per square foot was not high enough. Her goal, and the project objective, was to raise her revenue while also increasing space for her stylists. The metrics used for these objectives were revenue per square foot and the square footage of the retail areas. The beginning state metrics were 48.75 square feet of retail and a retail revenue per square foot of $2.15 with a total of six stylist stations. The immediate solution that the team created was to make some facility layout changes such as moving the front desk to open up a retail area in the entryway and change the storage room to a pedicure room so that there was more space for another stylist booth. In addition to the facility changes, selling strategies were improved. Retail items were strategically placed along a customer’s “critical path” so they would be more likely to see them while going through the regular steps of a hair service. After making these immediate changes, the retail square footage increased to 78 square feet and the retail revenue per square foot was raised to $3.47. To help Katie to keep track of her sales data in a more user friendly way, a dashboard was created for her to input data and view the sales trends, total sales, revenue per square foot, and a quantity count of which brands are selling the most. A t-test was run to determine if the changes made were significant. The test data was from February-April of 2021 and February-April 2022 and the p-value was 0.036, further proving the assumption that the changes benefited Katie’s salon. From here, long term solutions were created with the assumption that, in five years, Katie would be able to purchase her salon and completely redesign her space including plumbing and moving walls. There were 3 different layouts created and a simulation model was run for each of them. According to the simulation, design 3 would bring in the most revenue. A Multi-Criteria Decision Analysis was created to further analyze the models. The model focused on the design's ability to maximize revenue, increase retail space, increase retail visibility, increase customer comfortability, feasibility of implementation, increase in stylists stations, the A-efficiency score and sponsor approval. From this, solution 2 was the best design. Since Katie preferred solution 2 the most and it was only simulated to make $100 less than solution 3, it was chosen as the recommended 5-year plan.
URL: https://digitalcommons.calpoly.edu/imesp/263