Question

Karen, the owner of K's Candy Store has devised a plan to increase sales. Employees will be allowed, on their off days, to sell candy bars door-to-door. The plan allows employees to come to the store and take whatever amount of candy bars that they believe that they can sell. Further, they are to take, from the store cash register, a small sum of money with which to make change. Employees are to be paid a straight commission for their efforts based upon the number, and type, of bars that they report sold. Comment on this plan. Include in your answer any strengths and weaknesses that you see in the store's internal control system. Also, make recommendations to Karen ways in which internal control can be improved.

Answer 1

Strengths:

• it will allow employees to take more active part in the store day to day activity.
• It will help store to expand its reach

Weaknesses:

• There is no dedicated person controlling the employees as to how much candies they are taking.
• It shall encourage employees to ask customers not purchase in store and leave their contact details as they would deleiver them at home, thus reducing the organic store sales.

Suggestions:

• there should be quota system and employees unable to sell all the candies should return the unsold. Whereas if employee sold out more they can come back and get more.
• Employees should provide bill of the candy and give the copy of the bill to the store. Feedback from the customers should be taken thereafter for their experience with the selling executive.