Jimmy\'s Egg is a specialty restaurant featuring 47 different kinds of omelettes

Question

Jimmy's Egg is a specialty restaurant featuring 47 different kinds of omelettes in three different sizes. They use 60 dozen eggs a day that they order from an egg factory with a lead time of 5 days.

One day they stock their chiller and note that there are only 25 dozen eggs remaining. They have a backorder of 15 cases and an open order of 200 cases.

3.1 What is their inventory position? (IP)

3.2 Should they place an order? (Calculate the Reorder point to answer this question. There is no safety stock)

Explanation / Answer

1. they need 35 dozens of eggs to meet the present day demand in market. now they have only 25 dozens and the demand is for 60 dozens per day. so, they require another 35 dozens eggs for this day.

2. they should place an order when they are having 120 dozens in thier hand. because they have to maintain the stock for one day chiller and later it takes for preparation.

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