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Demand for a popular dress shirt at a Brooks Brothers distribution center (DC) is normally distributed with a mean of 65 units/day and standard deviation
Demand for a popular dress shirt at a Brooks Brothers distribution center (DC) is normally distributed with a mean of 65 units/day and standard deviation of 24 units/day. Brooks Brothers orders the shirts at a unit cost of $19. The annual cost of carrying inventory at the DC is 37% of the purchase cost per unit per year. It takes 30 days to receive a delivery. The DC reviews its inventory continuously. Assume 52 weeks/year, 7 days/week and 364 days/year. Compute the reorder point required to maintain a cycle service level of 98%. Carry your calculations to at least 3 decimal places. Round your answer to the nearest tenth of a unit (one decimal place)
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