Question: Aggregated inventory: Example Demand information (per week) Region 1: Normal with mean 250, std dev. 90 Region 2: Normal with mean 180, std dev. 70

Aggregated inventory: Example Demand information (per week) Region 1: Normal with mean 250, std dev. 90 Region 2: Normal with mean 180, std dev. 70 - Configuration 1: Warehouses at location A and B When available, use inventory to satisfy customer orders Service level target of 97% - Lead time factory-to-location is 1 week, H = $0.27 per unit per week - Configuration 2: Warehouse location C (Aggregate demand of A &B) All other costs and parameters same as the prev. locations How much safety inventory in each configuration? Step 1: Find the ROP and SS at each warehouse Step 2: Find the ROP and SS at new warehouse

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