1. Should management consider trade-offs between storing product in more locations in different territories, versus shipping product longer distances to customers? Why or how so? What are some specific concerns about having specific SKU stock keeping units of your inventory spread around in various locations?

2. How does the company know that it needs to spend next year on capital expenditures? Do you think that needs arise as we are preparing the operating budget with its revenues and expenses because of expected changes in revenues and expenses, or not? What do you think is a usual typical approach for the management team to determine current and future capital asset requirements? Please explain. It will be helpful to provide an example.