South face in view of demand uncertainty during leadtime

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Reference no: EM133620236

Question

The South Face retail shop sells outdoor clothing D: 1200 jackets/year K: $2,000 C: $200 per jacket i: 25% H: $ 50 per jacket for one year L = 2 weeks Assume the replenishment leadtime is L = 2 weeks. Demand during leadtime is normally distributed. The average demand in each week of the leadtime is 23 jackets with standard deviation of 7 jackets. Assume further that the South Face intends to provide a Cycle Service Level (CSL) of 0.95 to its customers during the leadtime. What must be the ROP of the South Face in view of demand uncertainty during leadtime?

Reference no: EM133620236

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