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The fact that the purchase of the machine did not contribute to the betterment of the situation, justified out thoughts that extra capacity will not be a solution to our problems. We sold this machine later on. REORDER POINT: We calculated the standard deviation of the demand: SD=+/-3...
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We sold this machine later on. REORDER POINT: We calculated the standard deviation of the demand: SD=+/-3.37. 12 jobs/day+SD3.37= 15.37 jobs/day - on 95% confidence level, the demand should not be more than about 15.5 jobs/day. We took this value, rounded it to the larger side (“better be safe than sorry”) and calculated the reorder point as max 16jobs/day* 4 days* 60 kits= 3840 kits...
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