Jimmy's Delicatessen sells large tins of Tom Tucker's Toffee. The deli uses a periodic review system, checking inventory levels every 10 days, at which time an order is placed for more tins. Order lead time is 3 days. Average daily demand is 7 tins, so average demand during the re order period and order lead time (13 days) is 91 tins. The standard deviation of demand during this same 13-day period is 17 tins. Calculate the restocking level. Assume that the desired service level is 90%.
Answer to relevant QuestionsFor problem 4, suppose that the standard deviation of demand during the 13-day period drops to 4 tins. What happens to the restocking level? Explain why.Now suppose the supplier of workbenches guarantees KraftyCity that the lead time will be a constant 3 weeks, with no variability (i.e., standard deviation of lead time = 0). Recalculate the reorder point, using the demand ...Sherry Clower is trying to ﬁgure out how many custom books to order for her class of 25 students. In the past, the number of students buying books has shown the following demand pattern:NUMBER OF STUDENTS PERCENTAGE OF ...The following figure shows an Excel spreadsheet that compares total ordering and holding costs for some current order quantity to the same costs for the EOQ and calculates how much could be saved by switching to the EOQ. ...Explain in your own words how tools such as master scheduling, MRP, and DRP can be used to coordinate activity up and down a supply chain. For example, what information might we share with our customers? Our suppliers? What ...
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