Distribution Centre Customers Quaterly Demand Weekly Demand

DC1 (Birmingham) Birmingham 11,160 930

Cardiff 83,700 6975
DC2 (Leeds) Leeds 139,500 11625
Liverpool 55,800 4650
Manchester 111,600 9300
DC3 (Glasgow) Glasgow 100,440 8370
Edinburgh 167,400 13950
Dundee 44,640 3720
 Total Cost
Holding Cost

Daily Demand Demand Frequency Demand Variation Variation Standard Deviation

133 7 10% 93 31
996 7 10% 698 233
1661 7 10% 1,163 388
664 7 10% 465 155
1329 7 10% 930 310
1196 7 10% 837 279
1993 7 10% 1,395 465
531 7 10% 372 124

Formulas
Reorder Point (R) = Average Demand x Lead time + Safety Stock
EOQ = √[(2 x quarterly demand x cost per order) / (holding cost per unit)]
Safety Stock = ZScore x Standard Deviation X √ (Lead time)
 100
10

Demand Mean (DC) Standard Deviation (DC) Lead Time Holding Cost (10% of Total cost)
1 10
1129
235 1 10
1 10
3654 1 10
520 1 10
1 10
3720 1 10
556 1 10

Safety Stock
holding cost per unit)]
Service Level (97%) Zscore (z) Safety Stock
97% 1.88
441
97% 1.88
97% 1.88
97% 1.88 978
97% 1.88
97% 1.88
97% 1.88 1046
97% 1.88
Reorder Point R Reorder R & Safety Stock Reorder Quantity Q
1129 1570 1377

3654 4632 2477

3720 4766 2500

Distribution Centre Customers Quaterly Demand Weekly Demand Daily Demand
Birmingham 11,160 930 133
Cardiff 83,700 6975 996
Leeds 139,500 11625 1661
Liverpool 55,800 4650 664
DC1 (Sheffield)
Manchester 111,600 9300 1329
Glasgow 100,440 8370 1196
Edinburgh 167,400 13950 1993
Dundee 44,640 3720 531
Demand Frequency Demand Variation Variation Standard Deviation Demand Mean (DC)
7 10% 93 31
7 10% 698 233
7 10% 1,163 388
7 10% 465 155
8503
7 10% 930 310
7 10% 837 279
7 10% 1,395 465
7 10% 372 124

Formulas
Reorder Point (R) = Average Demand x Lead time + Safety Stock
EOQ = √[(2 x quarterly demand x cost per order) / (carrying cost per unit)]
Safety Stock = ZScore x Standard Deviation X √ (Lead time)
Standard Deviation (DC) Lead Time (1 Day) Holding Cost (10% of Total cost) Service Level

797 1 10 97%
Z Score (z) Safety Stock Reorder Point(R) & Safety Stock

1.88 1498 10001

Reorder Quantity Q

3780