Question

Management states that they will tolerate one stockout every year for a specific item. If 10 orders are placed for the item each year the service level desired is:

Answer 1

If 10 orders are placed for the item each year the service level desired is 95%.

What is a stockout in business?

Stockouts are what manifest while you run out of inventory of a specific object. An out-of-stock can appear everywhere within the supply chain, however, it affects stores' cabinets and income the maximum while it takes place because the customer is set to buy.

Stockouts generally discuss a product being unavailable for purchase at retail, as opposed to somewhere else within the delivery chain. They're maximum obvious in the fast-shifting patron items sector. The opposite of a stockout might be an overstock, wherein case there is a surplus of inventory.

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