If you were a supplier to one of the companies that is taking longer to pay, what course of action would you (could you) take?
How can lower inventory levels be associated with higher gross margins? What’s the counter argument? If you were the head of merchandising at Macy’s, what factors do you consider in inventory levels?
How would you balance inventory between retail stores and distribution centers? Do you foresee more and more shopping online, even for toothpaste? Who wins? Who loses?
Do you agree that the LCM test under US GAAP is unduly complicated? If so, do you think that the proposed ASU simplifies the accounting? What would be lost, if anything, in the change?
What is a red flag that inventory levels are too high? What are some potential consequences of too much inventory on future cash flows and earnings? Can you name any early warning data that could alert you that inventory might grow too fast?
