Friday, October 10, 2014

Jimmy’s Delicatessen sells large tins of Tom Tucker’s Toffee. The deli uses a periodic review...

Jimmy’s Delicatessen sells large tins of Tom Tucker’s Toffee. The deli uses a periodic review system, checking inventory levels every 10 days, at which time an order is placed for more tins. Order lead time is 3 days. Average daily demand is 7 tins, so average demand during the reorder period and order lead time (13 days) is 91 tins.  The standard deviation of demand during this same 13- day period is 17 tins. Calculate the restocking level.  Assume the desired service level is 90% percent.

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