The company attempts to minimize the amount of inventory. The company has adopted point-of-use replenishment for some areas of operations, having…

The company attempts to minimize the amount of inventory. The company has adopted point-of-use replenishment for some areas of operations, having deliveries come directly to the production floor. However, there is a real need to reassess this strategy for international purchases. The current model of ordering and inventory ignores calculated economic order measures as well as quality discounts that might be offered. For example the needs of the company from the soya bean oil; being as a crucial ingredient and imported from an international supplier has a total demand of about 3000 tons/month. Ordering costs are 120 pound per order, carrying costs are 4 pounds per ton a month. According to the supplier last price list, orders less than 350 tons will cost 250 pounds per ton, 350 and less than 450 will cost 240 pounds per ton, 450 and less than 500 will cost 230 pounds per ton and larger orders will cost 220 pounds per ton. Currently, the organization has an order quantity of 350 tons per time. The lead time needed from placing an order till having the order in hand is around 20 days on average.

Need some help calculating all inventory management rules , P,U And demand during lead time. Thanks alot

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