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Calculate RBS Company’s Reorder Point including safety stock for the Pen Sets given the following information; Demand (D) is 100 Pen Sets per month. Lead Time (LT) from Supplier X is 15 days. Safety Stock (SS) is 10 Pen Sets.

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chamberlainuket

Answer:

Reorder point = (Average Daily unit sales * Lead time) + Safety stock

Suppose one month of 30 days, Average daily unit sales = 100/30

Reorder point = ((100/30) * 15) + 10 = 60 units

Thus, RBS company needs to reorder when the stock reaches 60 units

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