How much of that can be considered safety stock

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The housekeeping department of a motel uses approximately 200 bars of soap per day. The actual number tends to vary with the number of guests on any given night. Usage can be approximated by a Normal distribution that has the mean of 200 and a standard deviation of 8 bars per day. Soaps are ordered from a distant supplier with a lead time of three days. If the motel policy is to maintain a stock out risk of 10 percent, what is the minimum number of bars that must be on hand at reorder time, and how much of that can be considered safety stock?

Reference no: EM131659631

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