Probability of stockout during replenishment time

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The normal distribution is one of the most useful distributions that has applications in many business settings. Assume you are a business analyst in Costco, and you want to re-evaluate the replenishment order point to efficiently plan the inventory of fresh produce imported from the USA to satisfy customers' demand while supplying fresh produce. Assuming the daily demand follows a normal distribution, discuss how you would approach this task. What data do you need to collect? And what measures do you need to find? (Hint: think about the probability of stockout during replenishment time.)

Reference no: EM132851913

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