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Operations Management with Retailers

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Please show all work and place answer in the answer portion provided at the end of the question. Do not just write the answer in the answer sheet, all work has to be shown.You must use the z-Table provided in this document. All calculations are assumed to be based on this table. When doing the problems, round YOUR ANSWERS to ONLY FOUR decimal, where there are fractions present.

Problem No. 6

A retailer currently holds 45 units of safety stock for one of its products. Demand for this product averages 100 units a week with the standard deviation of 12 and the lead time for it is 3 weeks. The current industry standard for this firm is 2% stockout. Is this retailer competitive? WHY? You must show your calculation and explanation below, otherwise there will be no credit.

Solution Preview

See the attached file. Thanks

Problem No. 6

A retailer currently holds 45 units of safety stock for one of its products. Demand for this product averages 100 units a week with the standard deviation of 12 and the lead time for it is 3 weeks. ...

Solution Summary

Operations management with retailers are examined. The retailer competitive stock-outs are determined.

$2.19