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Le Bon Pain au Chocolat has 5 stores in small towns in Michigan. Monthly average demand and standard deviation at each store are 141 and
Le Bon Pain au Chocolat has 5 stores in small towns in Michigan. Monthly average demand and standard deviation at each store are 141 and 30, respectively. These demands are independent of each other. The production lead time is 3 days (assume 30 days per month). Assume Le Bon Pain au Chocolat maintains a 95% cycle service level. Let ROP_original be the reorder point that Le Bon Pain au Chocolat calculated optimally in each store (i.e., the reorder point for each store is ROP_original). The company is considering closing all of its current stores and opening an online delivery service through a website. Let ROP_online be the reorder point that Le Bon Pain au Chocolat optimally chooses for the online store. What is the ratio of ROP_online over ROP_original (i.e., ROP_online/ROP_original)? Round your answer to the closest one decimal (e.g., 3.5)
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