A company currently has 200 units of a product on hand that it orders every two weeks

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A company currently has 200 units of a product on hand that it orders every two weeks when the salesperson visits the premises. Demand for the product averages 20 units per day with a standard deviation of 5 units. Lead time for the product to arrive is seven days. Management has a goal of a 95 percent probability of not stocking out for this product. The salesperson is due to come in late this aftemoon when 180 units are left in stock (assuming that 20 are sold today). How many units should be ordered?

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Operations Management For Competitive Advantage

ISBN: 1572

11th Edition

Authors: Richard B. Chase, F. Robert Jacobs

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