Exercise 12-15: Epson
Inputs
Weekly Demand for Epson Printers in Europe
Country Mean Demand Standard Deviation
France 3,000 2,000
Germany 4,000 2,200
Spain 2,000 1,400
Italy 2,500 1,600
Portugal 1,000 800
UK 4,000 2,400
Lead time (weeks) 8
Target cycle service level 0.95
Demand and Standard Deviation for Epson Printers in Europe during Replenishment Lead Time
Country
Mean demand during
lead time DL =
SD of demand during
lead time σL =
France 24,000 5,657
Germany 32,000 6,223
Spain 16,000 3,960
Italy 20,000 4,525
Portugal 8,000 2,263
UK 32,000 6,788
Aggregated 132,000 12,573
Output
Required Safety Inventory for Epson Printers in Europe
Portugal 3,722
UK 11,166
Total 48,384
Aggregate safety inventory at DC 20,681
Savings 27,704
Epson produces printers for sale in Europe in its Taiwan factory. Printers sold in different countries differ in