Business, 16.04.2020 00:22 alexacarillo

Weekly demand for private label washing machines at Arcelik, a Turkish department store chain, is normally distributed with a mean of 500 and a standard deviation of 200. Arcelik has a source in China that delivers machines at a cost of 200 euros. The fixed cost of placing an order with a supplier is $100. The lead time required by the supplier is 9 weeks. A European supplier has offered to deliver washing machines with a guaranteed lead time of one week at a cost of 210 euro. The fixed cost of placing an order is unlikely to change and is expected to remain at $100 per order. Arcelik has a holding cost of 25% and targets a cycle service level of 99%. Should Arcelik accept the European supplier’s offer?

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Weekly demand for private label washing machines at Arcelik, a Turkish department store chain, is no...

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