Operations management with retailers


Question: A retailer currently holds 45 units of safety stock for one of its products. Demand for this product averages 100 units a week with the standard deviation of 12 and the lead time for it is 3 weeks. The current industry standard for this firm is 2% stockout. Is this retailer competitive? WHY? You must show your calculation and explanation below, otherwise there will be no credit.

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Operation Management: Operations management with retailers
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