What will happen to the cycle service level for this solvent

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Reference no: EM132164569

Pennzoil distributes solvents and lubricants. For a particular solvent, it sells on average 60 barrels per week although there is some variation in its weekly sales rate. It currently faces a one-week lead time to acquire more solvent from its supplier. It currently uses a reorder point of 90 barrels. The supplier has informed Pennzoil that it is moving production of the solvent from the US to China and that consequently, the lead time will be increasing to four weeks. Pennzoil has decided to increase its reorder point to 285 barrels. What will happen to the cycle service level (i.e., the probability that all demand will be met during the cycle) for this solvent (increase, decrease, stay the same)? Explain

Reference no: EM132164569

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