Question: really need help solving. im not sure how to go about this question. please help me find correct answer. Below is a graphic of a
really need help solving. im not sure how to go about this question. please help me find correct answer.
Below is a graphic of a firm's lead time frequency. The firm has a 4 day average fill from stock with a 12 day average back order fulfillment. If the firm segmented it's customer base and filled A customer orders in average 3 days with an average back order fulfillment of 10 days, what will be the impact on safety stock. Filled from stock Frequency Back orders 2 3 4 1 6 5 11 12 13 14 7 8 10 Lead Time Length (days) O Safety stock will be decreased by 50% since the cost is not linear. The supplier can safely decrease their safety stock below the level required to serve Segment A customers, due to the fact that 100% customer service is likely not possible at an acceptable cost. Customers in Segment A can safely decrease their safety stock but Band C customers cannot. Most customers will receive their complete order by day 10 in the new system
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