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The demand and supply can never be assessed exactly. There is discrepancy between actual and estimated demand and supply quantities with fair degree of uncertainty. A buffer stock can also be defined as the average stock available inventory when the fresh supply arrives. It is presumed that this stock will be able to cope with the emergency if and when experienced. Generally buffer stock is maintained at the desired level by discontinuous replenishments at varying intervals of time. Factors affecting choice of buffer stocks are uncertainty in demand uncertainty in lead times and size of the batch. The large the uncertainty associated with any factor larger should be the size.
Strategic Issues Facing the Service Industry In today's challenging business environment, professional service industry is facing various kinds of strategic obstacles related
Existing machine Purchased 3 years ago Cost=22,000 Installation= 3000 Depreciation=3 years using the MACRS - 5 year Recovery schedule Current market value=10,000
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