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Crew Soccer Shoes Company is considering a change of their current inventory-control system for soccer shoes. The information regarding the shoes is given below: Demand=80pairs/weekLeadtime=threeweeksOrdercost=$40/orderHoldingcost=$3.00/pair/yearCycleservicelevel=96percentStandarddeviationofweeklydemand=40Numberofweeksperyear=52
Crew Soccer Shoes Company is considering a change of their current inventory-control system for soccer shoes. The information regarding the shoes is given below: Demand=80pairs/weekLeadtime=threeweeksOrdercost=$40/orderHoldingcost=$3.00/pair/yearCycleservicelevel=96percentStandarddeviationofweeklydemand=40Numberofweeksperyear=52 a. The company decides to use a fixed-order quantity system. What would be the reorder point and the economic order quantity? Round your answers to the nearest whole number. Economic order quantity: Reorder point: units units b. In this system, at the beginning of the current week, the materials manager, Luke Thomas, checked the inventory level of shoes and found 400 pairs. There were no scheduled receipts and no back orders. Should he place an order? Explain your answer. Since the inventory level of 400 pairs is than the reorder point, Emily place an order. C. If the company changes to a fixed-period system and reviews the inventory every two weeks (T=2), how much safety stock is required? Round your answer to the nearest whole number. units
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