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Essay's paper info
Topic: Business
Number of pages / Number of words: 7 / 1869
Essay's paper body

Note properly utilized

5- The individual re-order levels have not been reviewed for several years these were originally based on two weeks' average sales at that time not considering current market demands.

6- Reduce level of confidence from distributors due to delay of order received.

7- Distributor receiving orders in several batches which lead in increase their administrative cost...


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The batch size is calculated by a formula that minimizes the cost through balancing the set up cost against the cost of stock.

EBQ=sqrt(2*D Sc/CH)where D is annual demand, Sc is set up cost, C is unit variable cost and H is unit holding cost

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  • D=Annual demand
  • S=Setup cost
  • C=unit variable cost
  • H= holding cost per unit
  • P= Production rate

_____________

EBQ = / = 2*500*50000 = 8165

v 3...


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