A lean system has the following characteristics: demand rate = 40 parts per hour; safety stock required = 10%; the container size = 8; lead time to replenish an order = 4 hours. If the number of containers is reduced by 2 units, what would be the new required round-trip time, all else being constant?

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Business

Rogelio Solis

18 March, 08:31

A lean system has the following characteristics: demand rate = 40 parts per hour; safety stock required = 10%; the container size = 8; lead time to replenish an order = 4 hours. If the number of containers is reduced by 2 units, what would be the new required round-trip time, all else being constant?

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Bradley Palmer · Answer 1

Answer: The new round trip time will be 1.636 hours

Explanation: In arriving at the new round trip time when the number of containers is reduced by 2 units, the actual number of containera have to be derives first.

K = DT (1 + S) / C

where; k = number of containers

D = demand rate

T = lead time

S = safety stock (in percentage)

C = container size

K = 40 * 4 (1.10) / 8

= 80 (1.10) / 8 = 88/8

= 11 containers

Since we have 11 containers, if reduced by 2 units it becomes 9 containers.

Therefore, k = dt (1+s) / c

9 = 40T (1+0.10) / 8

9 = 40T (1.10) / 8

9 = 44T/8

9 * 8 = 44T

72 = 44T

T = 1.636 hours