Magazine Luiza is a Brazilian retail chain for consumer elec-tronics. The company currently has 100 stores distributedacross Brazil. It also operates an online channel. It is consid-ering introduction...


Magazine Luiza is a Brazilian retail chain for consumer elec-

tronics. The company currently has 100 stores distributed

across Brazil. It also operates an online channel. It is consid-

ering introduction of a new printer and must decide whether

to offer it at retail stores or the online channel. Weekly

demand for the printer at each store has been forecast to be

normally distributed with a mean of 100 and a standard devi-

ation of 80. The company has also forecast that the demand at

the online channel would be the sum of demand across all

100 stores. The supplier will take four weeks to fulfill a

replenishment order, whether placed separately by each store

or by the online DC. Magazine Luiza is targeting a CSL of

95 percent and monitors its inventory continuously. How

much safety inventory will Magazine Luiza carry if the

printer is carried at all 100 stores? How much safety inven-

tory will Magazine Luiza carry if the printer is carried online

and demand across stores is independent? How much safety

inventory will Magazine Luiza carry if the printer is carried

online and demand across stores has a correlation coefficient

of r = 0.3?
Oct 07, 2022
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