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Part 2: Financial Impact Changes in order fill rates Using the information below, calculate the cash flow lost for each of the following fill rate
Part 2: Financial Impact Changes in order fill rates Using the information below, calculate the cash flow lost for each of the following fill rate % (i.e. customer service): 75%, 80%, 85%, 90%. Then calculate the difference between the rates. 1,200 units per order (average) 4,000 orders per year Pretax profit per unit = $3 Pretax profit per order = $3600 Invoice deduction per order = $450 Percentage of incomplete orders back-ordered is 78% Backorder costs (per order) = $300 Percentage of incomplete orders cancelled is 22% Part 2: Financial Impact Changes in order fill rates Using the information below, calculate the cash flow lost for each of the following fill rate % (i.e. customer service): 75%, 80%, 85%, 90%. Then calculate the difference between the rates. 1,200 units per order (average) 4,000 orders per year Pretax profit per unit = $3 Pretax profit per order = $3600 Invoice deduction per order = $450 Percentage of incomplete orders back-ordered is 78% Backorder costs (per order) = $300 Percentage of incomplete orders cancelled is 22%
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