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You need to choose one sultable supplier among two avaliable suppliers for a product x . Your Weekly demand for x at is normally distributed
You need to choose one sultable supplier among two avaliable suppliers for a product Your Weekly demand for at is normally distributed with a mean of and a standard deviation of You have historically purchased a per month from a local supplier who charges Ris per unit. You have identified another potential source willing to supply the at Rs per unit. Before making decision, you evaluate the cost associated with the two suppliers. You are currently using continuous review policy for managing inventory and aims for a cycle service level of percent. Which supplier should you go with if you have a holding cost of percent? Note FS
tableLocal Supplier,Potential SupplierAverage lead time, week, weeksSD in Iead time, week, weekMinimum batch size,
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