Where normal usage of a given item is 10 cans per day, and a minimum of 8 days is required for delivery, which of the following would be a suitable reorder point?

Question

Quizplus · Accepted Answer

The reorder point should cover the demand during the lead time. With a usage of 10 cans per day and a delivery time of 8 days, the reorder point should be 10 x 8 = 80 cans. However, to ensure no stockouts, a higher reorder point like 120 cans is more suitable.

Where Normal Usage of a Given Item Is 10 Cans