As demand at the supermarket chain grows, how would you expect the cycle inventory measured in days of inventory to change? Explain.
Answer to relevant QuestionsThe manager at the supermarket in Question 1 wants to decrease the lot size without increasing the costs he incurs. What actions can he take to achieve his objective? Why is it appropriate to include only the incremental cost when estimating the holding and order cost for a firm? Describe the two types of ordering policies and the impact that each of them has on safety inventory. A firm improves its forecast accuracy using better marketing intelligence. What impact will this have on supply chain inventories and profitability? Why? What transportation challenges does Peapod face? Compare transportation costs at online grocers and supermarket chains.
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