MS Fawaz is the general manager for the LAU Cafeteria. She has faced some difficulties with ordering the right amounts of food items. Because of this, there are some weeks the Cafeteria has a surplus of menu items that are no longer fresh, and must be discarded. At other times, the cafeteria has experiencedmportance of managing inventory. MS Fawaz would like to find a way to ensure that she is maintaining the proper amount of inventory. To attract more customers, she believes that a key aspect of this is having all of the items on the menu in stock. Each Wednesday, the manager physically counts the inventory on hand and enters the data into the online inventory system. The computer software system then compares the on-hand inventory for that week, the amount of food ordered, and the inventory on hand for the end of the previous week with the sales for the current week. By doing so, it is able to determine a total food cost. The manager compares this cost with the benchmark cost to see how well the cafeteria has been managing its inventory. This is one of the most important numbers to managers at the LAU Cafeteria because it accounts for approximately 30 percent of total costs in terms of a stores cost structure. The computer software system also compares the total cost of food on hand with the total amount of sales for that week and computes a percentage of on-hand inventories. As a guideline, the company has set a standard of having between 29 and 36 percent for its on-hand inventory level. The LAU Cafeteria that MS Fawaz manages has been running above average in terms of food costs. For this reason, her boss has become concerned with the performance of the ordering system she is using at the cafeteria. MS Fawaz has been using her intuition to decide how much product to order, despite the fact that the product order sheets provide a moving average usage of each product. MS Fawaz bases her inventory management on her intuition because she does not understand how to utilize the moving average forecasting technique when placing orders. An additional complication with ordering inventory is that each item is packed in multiple quantities, so she cannot order the exact amount she needs. Her boss requested that she create a more accurate way of ordering food and to report back to him in one month. MS Fawaz is worried that if she cuts inventory levels too low, she will run out of products, which may result in a decrease in customer counts. Suppose you have been asked to work with MS Fawaz to improve inventory ordering.

4. Assuming the Gravy Mix pack cost $3 each, and they sell for $8 each. Unsold Gravy Mix will spoil after one week and hence will be thrown away. MS Fawaz study of the recent demand resulted in the following table: How many Gravy Mix packs should be stocked to maintain optimum service level? 4. Assuming the Gravy Mix pack cost $3 each, and they sell for $8 each. Unsold Gravy Mix will spoil after one week and hence will be thrown away. MS Fawaz study of the recent demand resulted in the following table: How many Gravy Mix packs should be stocked to maintain optimum service level