The Ham Bone Sandwich Company makes rib-shaped barbecue pork sandwiches that are

Question

The Ham Bone Sandwich Company makes rib-shaped barbecue pork sandwiches that are frozen, boxed and shipped to large retailers. You have been asked to reduce inventory by establishing a kanban system. The daily production (demand) rate is 1400 units. The production lead time is 2 days. They want to keep 0.50 days of safety stock on hand (the safety stock factor) in order to respond quickly to spikes in demand. The kanban size is 96 units.

How many kanbans do they require? Round your answer to two decimal places

Explanation / Answer

The formula for determining the number of kanbons required(Y) = [D*T*(1+X)]/C

where D= Demand per unit of time =1400

T = Lead time =2

C = container capacity =96

X = buffer or safety factor =50%

Y= [1400*2*(1+0.5)]/96 = 43.75 kanbons

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