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Holding cost ? Ordering Cost ? Desired service level ? You may takeby yourself, if required. Bcz I already posted the complete info whatever my
Holding cost ? Ordering Cost ? Desired service level ? You may takeby yourself, if required. Bcz I already posted the complete info whatever my prof provided to me. Hopefully, you give the solution with explanation
The PC Solution (PCS), a Texas-based retail computer store, is faced with fierce competition in terms of both price and service. PCS is particularly concemed about the number of stockouts occurring on a popular type computer. Stockouts are very costly because when PCS cannot supply this particular computer, the customer promptly buys it from a competing store and PCS loses the sale. There is usually no opportunity to backorder the computer because the customer does not want to wait. PCS may also lose future business from that customer as well. PCS measures the effects of stockouts in terms of service level, or the percentage of total demand that can be satisfied from inventory PCS sells an average of 6 computers a day. However the sales can vary on any given day From the previous 100 sales' days, the frequency distribution for the number of units sold is Units 0 Davs1 16 The manufacturer of this computer is located in Washington state. Although it takes an average of 4 days for PCS to receive an order from the manufacturer, the time it takes to receive an order is also subject to uncertainty. The number of days to receive an order (sometimes referred to as lead time) can be summarized by the following frequency distribution based on thelast 50 orders Lead Time (days) Frequency of orders 10 30 10 PCS is faced with two decisions to make: (1) howmany computers to request with each order - the order quantity, and (2) when to place the order - the reorder point. The reorder point is that stock level that would trigger a new orderStep by Step Solution
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