Bob Billy is an operations analyst for Dollar-Does-It stores based in Iva, SC. He is currently studying the order and stocking policies for a top-selling toy. His analysis has indicated an almost constant lead time of 10 days. Bob calculated that the daily demand was normally distributed with a meanof 1,250 toys per day with a standard deviation(Ï?d) of 375 toys per day.
a. Compute the order point for the toy if the service level is specified at 90% during the lead time.
b. How much safety stock would Bob Billy carry?
Please find below help on your posting:
Average daily demand = 1250 units
Std dev of daily demand = 375 units
Lead time = 10 days
Service level …
Solution shows calculations of safety stock and reorder point.