Question: A warehouse serves 3 retail stores with a certain home cleaning product. The retail stores are called Fairview, Bristol, and Springfield (for the towns they

A warehouse serves 3 retail stores with a certain home cleaning product. The retail stores are called Fairview, Bristol, and Springfield (for the towns they are in). The lead time between any retail store and this warehouse is 4 working days. The lead time between the warehouse and the manufacturer is 10 working days. Daily demand for the working days in the past year is given in the Excel file for this question. Each row in the Excel file gives demand for that day. The data runs from day 1 to day 312 because the stores were only open for 312 working days in the calendar year.

The company uses a cycle service level (CSL) of 98% for this product.

Excel data file with demand data: Echelon Scenario Data.xlsx Download Echelon Scenario Data.xlsx

This situation is demonstrated in the figure below:

Compute the total demand that the warehouse needs to plan for. Assume the demand at the 3 stores is independent (i.e. uncorrelated). You can use the formulas below to do so for uncorrelated demand:

What is the standard deviation of the total demand for the warehouse (using the formula given above)? Round your answer to 3 decimal places.

Hint: You will need to find the average demand and the standard deviation of demand for each store first. You can do that by looking at the daily demand data in the Excel file and computing average and std. deviation for each column.

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