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Sometimes things do not go as planned. For the company Emilias Excellent Energy Savers (they sell modification kits to reduce air drag on trucks, market mainly North America), customer service has plummeted, sales as well. The CEO, Emilia Chalmers, needs to take action. She says:

We are a typical make-to-stock company. Our production line is extremely efficient since we reduced the number of variants and we are now producing large batches at a very competitive cost level. Also, since we reduced the number of warehouses from 10 to 3, our tied-up capital has decreased.

However, we have, since the reduction, experienced an increase in lead-time from order to delivery that the customers do not accept. They want delivery the next day, or even the same day! Also, we are swamped with support calls from customers who need help and advice. We simply do not have the time! We have also seen indications that our customer base often buys our products together with other types, such as paint and extra lights etc. We do not offer these things, which makes our customers choose competitors that do instead.

The company has hired some consultants and they have given the following advice:

Increase the number of warehouses to 5

Use an intermediary distributor to meet market demands

2a. How will the stock level change if the company moves from 3 to 5 warehouses?

2b.How much of the original stock level (10 warehouses) will remain for 3 warehouses?

Enter the correct number (in %, with one correct decimal) in the input field.

2c.How much of the original stock level (10 warehouses) will remain for 5 warehouses?

Enter the correct number (in %, with one correct decimal) in the input field.