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Weekly demand for Barilla pasta at a Hy-Vee store is normally distributed, with a mean of 250 boxes and a standard deviation of 150 boxes. The store manager continuously monitors inventory and currently orders 1,000 boxes of pasta each time the inventory drops to 600 boxes. Barilla currently takes two weeks to fill an order.
(a) How much safety inventory does the store carry given the current policy?
(b) What service level does store achieve for Barilla pasta with the current policy?
(c) What fill rate does the store achieve with the current policy?
(d) If the Hy-Vee store would like to have a 99% service level, what should the reorder point be?
(e) If the Hy-Vee store would like to have a 99% fill rate, what should the reorder point be?
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