Inventory management for special units at business

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Reference no: EM131035638

You have just taken over inventory management for special units at a business. Currently there are 120 units in stock, it takes between 1 and 3 weeks to receive an order of 100 new units, and demand runs between 0 and 25units per week. Where should you place the restocking Kanban if your management wants to be certain that you never run out but they also want to minimize their carrying costs(i.e., they want to keep as few units on hand as they can while still guaranteeing that they never run out)? How well does this model workif you were to know that restocking takes only 1 week the vast majority of the time and that demand is most often just 10 units per week? What additional information would you need to know and what would you do with it if you were tasked with merely maintaining enough inventory so that you could be 95% (i.e., really) certain that you wouldn't run out?

Reference no: EM131035638

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