Operations Management.xlsx

	B	C	D	G	H	I	J
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2	Assumptions: Revenue Share Estimation for Real Canadian Superstore (RCSS)			Table: RCSS Revenue Projection (Using 3.5% YoY Growth)
3	Real Canadian Superstore (RCSS) is a subsidiary of Loblaw Companies Limited. Since Loblaw does not publicly break down revenue by banner, we applied a structured estimation method to approximate RCSS’s annual revenue contribution. The goal is to create a realistic, defensible baseline for operational planning.			Year	YoY Growth Rate	Calculation	Estimated Revenue (CAD)
4				2024 (Base Year)	—	Given	$ 7,931,820,000.00
5				2025	3.50%	7,931,820,000 × 1.035	$ 8,209,433,700.00
6				2026	3.50%	8,209,973,700 × 1.035	$ 8,496,763,879.50
7	1. Reasoning Behind the Estimation Approach			2026 Revenue			$ 8,496,763,879.00
8	Because specific RCSS revenue data is unavailable, we estimated its contribution by comparing:			We applied a 3.5% year-over-year (YoY) growth rate because it reflects a realistic, mid-range estimate for Canada’s grocery retail sector, which typically grows between 2% and 5% annually. This rate balances industry stability with the steady performance of large-format retailers like Real Canadian Superstore. Using 3.5% provides a reasonable and defensible projection without overstating future performance.
9	RCSS store-count share within Loblaw
10	RCSS format type and relative performance (large-format hypermarkets generate higher sales per store)
11	RCSS operates significantly larger stores than Loblaw’s typical grocery or drugstore formats.
12	So it is reasonable to assume higher per-store revenue.
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14	Method used - Weighted Store-Type Premium
15	Key Logic
16	RCSS stores account for approximately 5% of Loblaw’s total store count.
17	RCSS stores are large-format hypermarkets; therefore, they likely produce 2–3× the revenue of the average Loblaw store.			Table: RCSS Operations Assumptions
18	Applying a midpoint multiplier of 2.5× adjusts the store-count share upward to a more realistic revenue share.			Category	Assumption	Value / Notes
19				Revenue	Base year revenue (2024)	CAD 7,931,820,000 (midpoint estimate from Loblaw)
20	Calculation Summary				Projected YoY growth	3.5% (reflects industry average; conservative for large-format supermarkets)
21	Table 1: Revenue Share Estimation Logic				Projected revenue 2026	CAD 8,497,322,806
22	Item	Value	Notes	Seasonality	Monthly sales distribution	E.g., Jan 6%, Feb 6%, Mar 7%, Apr 7%, May 8%, Jun 8%, Jul 8%, Aug 9%, Sep 9%, Oct 8%, Nov 12%, Dec 12%
23	RCSS store count	~119 stores	Approximate national count	Products / SKUs	Product categories	Fresh foods, packaged groceries, pharmacy/health, apparel (Joe Fresh), home goods, seasonal items
24	Loblaw total stores	~2,400+	Across all banners		Average unit price	Varies by category (can be derived from revenue ÷ units sold)
25	RCSS share of total stores	≈ 5%	119 ÷ 2,400	Stores / Operations	Number of RCSS stores	~119
26	Revenue premium multiplier	2.5×	Hypermarket size advantage		Working days per month	22 (approximate average)
27	Adjusted revenue share estimate	Approimately 12 - 15%	5% × 2.5 = 12.5%	Suppliers	Lead times (days)	Fresh produce: 5–10; Dairy: 2–3; Home goods: 30–45; Apparel: 60–90
28	Loblaws Revenue	(2024 Revenue)	$ 61,014,000,000.00		Supplier sourcing	Canada, US, Mexico, Asia depending on category
29					Procurement strategy	Contract-based for staples, forecast-based for seasonal products
30	Translation to Dollar Estimates (Based on Loblaw Revenue: CAD 61.014B)			Inventory Management	Safety stock	Calculated as Z × σ_daily × √LeadTimeDays; Z=1.645 for 95% service level
31	Table 2: Estimated RCSS Annual Revenue (Method B)				EOQ	SQRT(2 × Annual Demand × Ordering Cost / Holding Cost per unit per year)
32	Scenario	% of Loblaw Total Revenue	Estimated RCSS Revenue (CAD)		Reorder Point (ROP)	Avg daily demand × Lead Time + Safety Stock
33	Lower bound	12%	$ 7,321,680,000.00		Holding cost rate	20% of unit cost per year (typical for grocery/retail)
34	Midpoint (base case)	13%	$ 7,931,820,000.00		Ordering cost	CAD 100 per order (estimate for procurement/PO processing)
35	Upper bound	15%	$ 9,152,100,000.00	Production / Replenishment	Replenishment cycle	Monthly, adjusted for lead times
36	These figures form the basis for the operational planning, sales forecasting, procurement modelling, and capacity projections in later sections of the project.				Max DC capacity	To be assumed per distribution center (e.g., pallets/day × working days)
37				KPIs / Performance Metrics	On-time delivery	Target >95%
38					Stockouts	Target <5% per SKU per month
39					Shrinkage	Target <2%
40					Days of Supply	Target 20–30 days for perishables, 40–60 for non-perishables
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43				Notes:
44				1. All percentages and rates (seasonality, growth, holding costs, service level) are assumptions based on industry averages and hypermarket performance.
45				2. Lead times and EOQ parameters are used in Inventory Management and Production Plan sheets.
46				3. Monthly sales in the Sales Forecast sheet will be calculated by applying seasonality percentages to the projected 2026 annual revenue.
47				4. Safety stock, ROP, and EOQ formulas will reference these assumptions directly in Excel.
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