The mega-store chain HG (Home & Garden) imports decorative planters from Italy. The average weekly demand is
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The mega-store chain HG ("Home & Garden") imports decorative planters from Italy. The average weekly demand is 1,000 planters ( if a comma appears, interpret it as a thousand separator). Each planter costs $10 at HG. The cost of capital at HG is estimated at 25%. Each order from Italy costs HG $10,000 (freight, customs, inspection, etc.) Suppose there are 52 weeks in a year.
Refer to the context of the previous question. If the weekly standard deviation of planter demand at HG was 930, the delivery time from Italy was 4 weeks and HG wanted to provide a 90% level of service to its customers, what size should be safety stock?
Related Book For
Managing Business Process Flows Principles of Operations Management
ISBN: 978-0136036371
3rd edition
Authors: Ravi Anupindi, Sunil Chopra, Sudhakar Deshmukh, Jan Van Mieg
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