Question: Kindly answer empty yellow box and extra: How much more would it cost to increase safety stock to reach a 97% service level? 99% service

Kindly answer empty yellow box and extra: How much more would it cost to increase safety stock to reach a 97% service level? 99% service level? Kindly answer empty yellow box and extra: How

But what if delivery isn't reliable?? ROP = (DD x RC) + SS under uncertainty Daily demand (average) DD 87.06 units/day Standard deviation of Demand = ODD = 8.497 units/day Historical Data Length of each Daily Demand replenishment (units) cycle (days) 95 13 90 11 Where DD = daily demand RC = length of replenishment cycle SS = safety stock 13.56 days Length of replenishment cycle (average) = RC= Standard deviation of Replenishment Cycle = ORC = 1.590 days Service level target = 95% z= 1.644853627 80 65 78 83 95 15 13 15 14 13 12 16 HINT: To convert Service Level to z-score, use -NORM.S.INV(probability) Reorder Point without Variability = 1.180.18 units When demand is uncertain (always ) and replenishment cycle is uncertain (always). Safety Stock (to buffer from variability) = SS= 233.4238208 units = SS = z Voz DD DD * RC + 02 RC * DD2 Reorder Point in the real world!) = ROP = 93 95 94 92 92 83 2 90 85 95 80 1,414.00 units (round to the nearest unit) I = $ Unit Cost of items in inventory = Inventory carrying cost rate = 15.00 per unit 3296 per year How much does it cost to hold just the Safety Stock for one year? ? per year Extra: How much more would it cost to increase Safety Stock to reach a 97% Service Level? To reach 99% Service Level

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